US-China Talks Influence Stocks More Than Impeachment Updates

WASHINGTON, D.C. – On the day that the Democratic leadership has confirmed the articles for President Trump’s impeachment, the stocks was relatively unchanged with very modest moves at most, suggesting that the stock market mostly relies on US-China trade relationship instead of impeachment news.

Market players mostly rely on cues around the ongoing trade talks between the US and China, as well as the tariff hike which is scheduled for December 15, which has kept investors at the edge of their seats. Recent talks that the two of the largest economies in the world still remains engaged on trying to end the long-standing trade war and talks that Trump might back off on the scheduled tariffs has lifted stocks.

According to Gao Feng, spokesperson of the Ministry of Commerce, Chinese trade officials are in with the trade negotiators in Washington for phase one of the trade agreement.

However, not every headline in China is positive for the market. On Thursday, Steven Mnuchin, Treasury Secretary, stated that he supports a World Bank program in removing China to give way to smaller and less affluent countries to refinance their debts.

Mnuchin also stated that the selection of David Malpass, former Treasury Undersecretary, as the new president of World Bank earlier in 2019 has given him confidence that the World Bank will make its practices so that lending becomes more equitable.

Comments from Mnuchin has capped share gains, with only the 14 stocks out of 30 listed under Dow Jones recorded gains.

On stock market for the upcoming week, The Dow Jones index is seen to have an impressive recovery. The index was seen bouncing from the trend line support, suggesting that it might be in for some gains the upcoming week. Consequently, the Dow Jones index is looking to be prime for a new retest of its previous record high at 28,000.

However, with the Washington-imposed tariff hike on Chinese imports on December 15, the risk increases along with the headlines on US-China trade talks. A new record high for the Dow Jones will most likely come when US and China signs an official phase one agreement before the impending tariff. But for now, prospects are staying supportive towards the equity market.

Also, throughout the previous week, the FTSE 100 index has been one of the biggest laggards, with its 1.7% decline. It was last seen falling down towards the lowest end for its current range after losing the support from the 200 DMA.

On the other hand, the UK stock market is looking towards a more volatile week as the general UK election looms around.