The U.S. stock market indexes increased after China announced that it was ready to find the solution which would be acceptable for both sides. The trade war between the U.S. and China dates back to 2018. However, it is far from being over. The trade war between the biggest economies is a global problem.
It is important to remember that the U.S. has the largest economy in the world. China’s economy is the second-largest economy. The trade dispute between the two economic superpowers has the potential to disrupt the stock market. However, the situation might change in the nearest future.
On August 29, China’s Ministry of Commerce released a statement regarding the trade war. This statement highlighted the importance of the trade war. Spokesperson Gao Feng made a comment which had a massive impact on the U.S. stock market. According to Gao Feng, China was ready to end the trade war. Gao said that countries should solve their disagreement without any further tensions.
Gao’s statement underlined the official position that China was interested to end the trade war. Another interesting fact is that China made the decision not to impose additional tariffs.
U.S. stock indexes reacted to this news. Dow Jones Industrial Average rose by 300 points. Another index, which is the S&P 500 also increased by 1.2%. Meanwhile, Nasdaq Composite increased by 1.4%.
During early trading, the response was more moderate. For instance, the Dow Jones index rose by 263 points. Other indexes such as the S&P 500 and NASDAQ also increased as well.
On Thursday, the shares of U.S. companies also benefited from this statement. For example, the shares of companies such as Caterpillar, Apple, Walt Disney, and others. Boeing’s shares also increased as well. Micron Technology’s shares rose by 2%.
The U.S. stock market’s reaction is a good example of how trade disputes or regional tensions can affect the stock market.
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