The Standard & Poor’s 500 was slightly in the green at the close today at 2881.40. That marked a big turnaround from earlier in the session. As of 11 a.m. New York time the index had dipped to 2826.29.
Today it was all about China and the trade/tariff talks between the United States and China. The initial drop on the day came as at 12:01 a.m. the United States raised tariffs on $200 billion of Chinese exports to the United States to 25% from 10%. China has promised to retaliate for the U.S. move.Later, though, stocks recovered much of their ground on extremely vague comments from President Donald Trump and Treasury Secretary Steve Mnuchin.
How vague?
Well, a CNBC headline that reported that President Trump had said he had an “excellent alternative” to a trade deal encouraged buying. Even though it turns out that the “excellent alternative” that the President has is higher tariffs.
Treasury Secretary Mnuchin’s comments amounted to a claim that the talks had been “constructive” although Mnuchin also added that no new talks were scheduled.
Balancing those comments were news stories from administration sources saying the United States had given China a month to wrap up a deal or face 25% tariffs on an additional $325 billion in Chinese exports to the United States.
In other news this morning initial claims for unemployment in the week ended May 4 fell by 2,000 to 228,000. That kept the four-week moving average for new claims (at 220,250) near a 50-year low.Despite the tariffs on Chinese goods the trade deficit rose slightly in March to $50 billion from $49.3 billion in February.The yield on the 10-year Treasury fell 3 basis points to 2.46%. The U.S. Dollar Index slipped 0.2%. U.S. oil benchmark West Texas crude lost 0.6% to $61.73 a barrel.
