Dow Jones futures struggled for traction on Wednesday, pointing to a flat open on Wall Street.
Traders are yet again weighing the impact of a trade war as China moves towards a hard-line stance on negotiations. It comes just a day after Trump said there was “a long way to go” and threatened further tariffs.
As of 7.25 am EST, Dow Jones Industrial Average futures traded at 27,334, a mere 6 points higher (0.02 percent).
Xi Jinping has reportedly invited a new member to the negotiating table and, according to the White House, he’s a tough negotiator.
Commerce Minister Zhong Shan is a known hard-liner and may push Jinping towards a more stubborn line in the forthcoming talks. As former White House negotiator Clete Willems told CNBC:
“China has now elevated its commerce minister Zhong Shan and made him a part of the core negotiating team along with (Vice Premier) Liu He. A lot of people are nervous — he’s seen as a hard-liner.”
Willems did, however, point to China’s shrinking economy, which slowed to 6.2 percent, as a sign that China is desperate to do a deal.
Trade war fears have dominated stock market strategy so far this year, so traders may opt for a risk-off approach on Wednesday.
Yesterday Trump surprised the markets with a shock threat to deploy a fresh round of tariffs on China. As CCN.com reported, Trump admitted there was a long way to go before many of the sticking points between the US and China resolved.
Also on the agenda today is a slew of corporate earnings from the tech sector, including Netflix, eBay, and IBM.
Last modified: September 23, 2020 12:50 PM