Stocks increased to 12% after US President Donald Trump and Chinese President Xi Jinping agreed on a truce in the US-China trade war, which resulted in a wave of relief through global markets.
In the meeting held, Trump agreed on easing restrictions on tech giant Huawei's US technology purchases and to hold off on tariffs for the US imports from China. While Xi agreed on purchasing US agricultural products and resumed trade talks. Trump and Xi’s “phase one” trade deal increased the S&P 500 to 12 %, the US benchmark index, reaching a new record high of 3.095.60 points.
The deal saw a boost in the market and opening up of prospects of trade but also saw the end of escalation in the dispute between the two countries.
Despite the trade deal having a long way to go, Trump stated that China has committed to $200 billion in purchases of American goods and services while Vice President Mike Pence stated that their agricultural purchases would be from $40 billion to $50 billion.
The trade deal between the two superpowers saw many investors celebrating, however that celebration was short-lived when analysts pointed out that previous rounds of tariffs were still in place and that Huawei was still blacklisted.