The trade war between the U.S. and China has placed vast pressure on the stock exchange’s of both the countries since mid of this year. With a new modified trade agreement within the works, China-U.S. relations are expected to boost within the upcoming months following this year in 2019.
U.S. President Donald Trump recently stated that a comprehensive trade deal is presently being written in an effort to extend U.S. exports and eliminate the friction between the 2 major economies.
Adding further Trump said:
“Deal is moving on alright. If made, it’ll be terribly comprehensive, covering all subjects, areas and points of dispute,”
Trade Agreement 2019
The U.S and China are set to conclude on a trade agreement by the first week in March this year. The wide selection of subjects, industries, and merchandise the trade deal is about to make it more harder for the negotiators of both parties to reach a decision.
Already, high tariffs on several products and areas like automotive exports are placed on hold by China. Previously, automotive makers like Tesla were charged around 40 p.c tariff. Affectingly, Tesla China sold-out the Tesla Model-3 at a value of over $99,000 USD.
Earlier in Dec. last, the govt. of China formally suspended tariffs on cars and a number of other major exports of the U.S. till 1st of March, relieving pressure on U.S. companies. But, if a comprehensive trade deal isn’t shaped by the Q1 of 2019, then the high tariffs on U.S. products and corporations can ‘resume‘.
Bearish Stock exchange Market’s
Some large-scale conglomerates have told Reuters that they’re getting ready for robust and tough days ahead.
The chairman of Tianming Group ‘Jiang Ming’, a conglomerate in health care, construction and finance, ‘added‘:
“Survival is overriding for us [next year]–we are going to be a lot more cautious with our investment. We additionally have to be compelled to maintain higher cashflows and save our ammunition to prepare for the tight, robust and tough days ahead.”
The failure to come to this agreement on the trade deal could lead on the stock exchange’s of the two countries to plummet below bearish market levels. But, if the U.S. and China develop a trade deal that works for both economies, the stock exchange of the two countries may even see unprecedented gains within the Q2 of this year .