Shales are recovering: US finance minister Explained trade war with China is not sustainable

Shales are recovering: US finance minister Explained trade war with China is not sustainable

The US trade minister Scott Bessent announced on Tuesday that the trade war between the United States and China was not sustainable and that he was expecting a de-escalation of the conflict, confirmed a person trusted with the matter. The Wall Street helped this statement to a short upswing in the morning.

rally on Wall Street

On Tuesday, US shares recorded profits as a whole, while investors entered the market after a strong sales pressure on Monday. The stock prices rose in the course of the morning after Bessent announced his de -escalation expectation in the trade dispute with China at a closed event. Bloomberg first reported about it.

market development and influence on indices

The Dow Jones rose by more than 1,000 points, while the S&P 500 and the Nasdaq Composite also reached their highest values of the day after Bessensent. However, the shares returned some of the profits in the early afternoon. Karoline Leavitt, spokeswoman for the White House, reported on Tuesday that she spoke to President Donald Trump and Kevin Hassett, director of the National Economic Council, about the Federal Reserve. Both expressed doubts about the decisions of the FED regarding interest rates, which fueled the concerns that the White House could try to undermine the independence of the Fed.

Current market conditions

uncertainty on the market

investors are tense because uncertainty about trade negotiations continues and Trump has strengthened his criticism of Fed boss Jerome Powell. The stock markets had a severe decline on Monday due to Trump's ongoing attacks on Powell because he does not reduce interest rates - a complaint that he has expressed several times. The independence of the FED is a trademark of the central bank, and market observers are unsettled by the continuing verdal attacks by the president on the Fed boss.

prospects for the Federal Reserve

"A trade war on several fronts alone is already stressful for the stock markets, so it is understandable that the markets react nervously in the event of a simultaneous crisis of Fed independence," said Jeff Buchbinder, chief strategist for shares at LPL Financial, in a message on Monday. Many experts emphasize that in fact the president does not have the power to simply dismiss the Fed boss due to disagreements in politics. Mohit Kumar, chief economist and strategist of Jefferies for Europe, said in a note on Tuesday that "it will be almost impossible to release Powell without a good reason", and it is unlikely that Trump will receive broad political support for Powell in 2026.

technical analyzes and market development

The return for 10 years of government bonds fell and the US dollar was able to grow slightly on Tuesday, which indicates relative stability after the massive sales pressure on Monday. The gold price briefly reached a new record of over $ 3,500 per troy ounce on Tuesday. The yellow metal has increased by more than 30% this year and exceeded the increase of 27% last year, since investors are increasingly investing in gold in the face of far -reaching uncertainty about economic outlook.

global economic effects

Trump's tariffs and the countermeasures of the United States trading partners are expected to put a heavy burden on global economic growth, although the US economy will be particularly affected, according to the International Monetary Fund (IMF). Global economic growth is expected to fall to 2.8% this year, compared to 3.3% last year and thus significantly below the historical average, as the IMF predicted in its global economic outlook on Tuesday. In the United States, an even steeper decline is expected, with expected growth of only 1.8% compared to 2.8% in 2024.

mood on Wall Street

This week Wall Street will be tense the possibility of progress in the trade talks, while numerous corporate profits are the focus for the first quarter. Investors will also pay attention to the winning figures of Tesla ( tsla ), which are to be released after the stock exchange conclusion. The market value of Elon Musk's electric vehicle company has dropped significantly this year because the shares have fallen by more than 40%. This decline comes at a time when there is a criticism of Musks role in the US government and inadequate sales in Europe.

"Extreme fear" was the predominant feeling that the markets drove on Tuesday, such as the Fear and greed index from cnn . The index is in a state of "extreme fear" this month.

This is a developing history and is continuously updated.

Reports by CNNS Matt Egan and Olesya Dmitracova contributed to this article.