Stocks surged on the progress of US-China informal trade talks

·       Overall, Trump’s comments and body language indicate progress in back-channel US-China trade talks, irrespective of any Trump-Xi phone call

·       Trump now wants China to open its economy further for US goods, which Trump sees as a ‘big win’ if it happens

·       The USTR is also preparing a standard global template for trade negotiations with the main 18 trading partners and others to conclude a trade deal by July 8

On Thursday, April 24, 2025, Wall Street Futures gained for the 3rd consecutive day in hopes of real progress in US-China trade talks, coupled with Fed rate cuts sooner rather than later. On April 25, 2025, President Trump made significant statements regarding trade, tariffs, and relations with China, marking a pivotal moment in his administration's economic policy.

Trump Claimed Progress in Trade Deals: In an interview with Time magazine, President Trump asserted that he had secured approximately 200 tariff agreements with foreign leaders. He expressed optimism that ongoing trade negotiations could conclude within three to four weeks, though the White House has yet to release details of any finalized agreements.

Communication with President Xi Jinping: Trump stated that Chinese President Xi Jinping had initiated a call to discuss trade matters. However, China's foreign ministry refuted this claim, labeling it as "fake news" and denying any ongoing tariff negotiations. 

Tariff Policies and Economic Impact: The Trump administration has imposed steep tariffs on Chinese imports, currently at 145%, prompting retaliatory measures from Beijing, including a 125% levy on U.S. goods and restrictions on rare earth mineral exports. Despite these tensions, Trump declared his trade strategy a success, citing a $7 trillion investment influx into the U.S. and asserting confidence in negotiating numerous deals imminently. Trump also frequently claims the US is collecting hundreds of billions of dollars in tariffs from China and other countries (exporters).

Trade and Tariffs: Trump sees the U.S. as a "big departmental store" where he sets prices, strongly supporting tariffs with plans to raise them to 50% on imports, believing it will lead to a "total victory" for the U.S. economy. He acknowledged market stress from his tariff policies but noted a temporary lift on some tariffs to stabilize markets.

China-Specific Comments: Trump confirmed active talks with China, with President Xi Jinping involved, stating there's a "number" for a deal but insisting the U.S. cannot allow China to make $1 trillion or $750 billion in trade profits. He expects to finalize deals in three to four weeks, amid his aggressive tariff approach since China's 2001 WTO entry.

Market Reactions and Economic Indicators: Wall Street experienced mixed performance amid ongoing uncertainty about U.S.-China trade relations. Major indexes fluctuated in early trading despite some signs of easing from China, which offered tariff exemptions on select U.S. imports. However, investor sentiment remained cautious, especially after President Trump stated he would consider 50% tariffs on imports a "total victory.

Consumer Sentiment Decline: Fears over the ongoing U.S.-China trade war have triggered a major slump in U.S. consumer expectations, with the University of Michigan reporting a 32% drop since January—the steepest decline since the 1990 recession. April's consumer sentiment index fell to 52.2, its fourth-lowest level since the 1970s, driven largely by worsening economic outlooks and inflation concerns. 

China's Response and Ongoing Tensions

Denial of Negotiations: China's foreign ministry denied any ongoing tariff negotiations with the U.S., urging Washington to stop "misleading the public."  China is not engaged in any consultations or negotiations on tariffs with the United States, a Chinese Foreign Ministry spokesperson said on Friday, contradicting US President Donald Trump's claims about a bilateral meeting Thursday. The spokesperson also did not confirm a report that China withdrew tariffs on some semiconductors made in the US. Chinese customs officers said they were not aware of any changes.

Selective Tariff Exemptions: China is considering suspending tariffs on U.S. medical equipment and other products, offering some relief amid ongoing trade tensions. However, this move is seen as a strategic easing of economic pressure points rather than a step toward ending the trade war. China also removes some tariffs on US-made chips.

The Chinese authorities have "quietly" pulled back retaliatory tariffs on certain semiconductors produced in the US. As per CNN, Chinese importers were informed about the exemptions late on Thursday. The decision hasn't been announced officially yet. China's General Administration of Customs and the customs offices in Shenzhen and Zongshan both told CNN they were unaware of such moves.

Broader Economic Implications

Impact on U.S. Companies: Apple plans to shift the majority of its iPhone production for the U.S. market to India by the end of 2026, aiming to avoid steep tariffs imposed on imports from China. This move reflects broader supply chain realignments prompted by the ongoing trade tensions. 

On Friday, April 25, 2025, Trump said:

·       I think a 50% tariff in a year would be a total victory

·       If the US still imposed tariffs on imports of up to 50% in a year, the US would be making a fortune

·       Companies would not relocate their production to the US if there were no tariffs.

·       We're taking in billions and billions of dollars, money that we never took in before

·       I planned investments from big tech companies, including Apple and Nvidia,

·       They "have no choice, because they won't be able to pay the tariffs if they don't do it

·       Small businesses will be a bigger beneficiary of MY economic policy than big firms

·       China's Xi called me—but I do not think that's a sign of weakness on his behalf

·       If people want to–well, we all want to make deals. But I am this giant store. It's a giant, beautiful store, and everybody wants to go shopping there. And on behalf of the American people, I own the store, and I set prices, and I'll say, if you want to shop here, this is what you have to pay

·       I have made 200 trade deals--they will be announced over the next three to four weeks and then we’ll be finished

·       Some countries could come back and ask for an adjustment—I am willing to consider them

·       I wasn't worried (when the US bond market came under stress earlier this month after which he paused most tariffs for 90 days)

·       I'm doing that until we come up with the numbers that I want to come up with

·       We are very close to a tariff deal with Japan

·       We have a lot of things going on, and I think in the end we'll end up with many good deals.

·       I spoke with President Xi many times

·       Opening China for US goods would be a big win

·       I would like to open China to selling American products and achieving that would be a big win.

·       But I may not even ask Beijing for such a thing as I think the Chinese don't want it open.

·        But my tariffs could make Beijing change its position

·       My administration is in active talks with the Chinese to strike a deal

·       Crimea will stay with Russia

·       I will set a fair price of tariffs for different countries

·       I would consider it a victory if the US has 50% tariffs a year from now

·       Trump predicts Saudi Arabia will go into the Abraham Accords

·       I wasn't worried during April bond market stress

·       Bessent and Lutnick didn't tell me to do a 90-day pause

·       I love the concept of raising taxes on wealthy

·       We are doing a 90-day pause until we come up with numbers I want

·       I don't think the budget will cut $800b from Medicaid

·       I would veto the bill with Social Security and Medicare cuts

·       I signal support for the ban on congressional stock trading

·       China's Xi has called me--- I spoke with China's Xi

·       I see peace in Ukraine and Russia as possible

·       We don't need anything from Canada

·       I am open to meeting Iran's President or Supreme Leader

·       Trump declines to discuss seeking a third term

·       Trade deals expected in the next three to four weeks

·       Russia and Ukraine are coming along

·       We're very close to a deal with Japan

·       We will end up with lots of good deals. The tariff plan is doing very well

·       We'll be reasonable on tariffs

·       I think markets are adjusting to the tariff policy

·       Iran's situation is going well

·       Trump floats potential for interim deal with Iran

·       We're dealing with the highest levels in Iran

·       We will be reasonable on tariffs

·       Won't remove China tariffs unless they give us something

·       Opening up China would be a big win

·       Markets are adjusting to tariffs

·       We'll have deals made, but for others, we'll set the tariff

·       Will not drop China tariffs unless they give us something

·       The Iran situation is coming out very well

·       The Iran deal is simple. They can't have a nuclear weapon

·       People are beginning to understand how good tariffs are

·       Another tariff pause is unlikely

·       Work on the overall Peace Deal between Russia and Ukraine is going smoothly. Success seems to be in the future

·       Zelenskyy has not signed the final papers on the Rare Earths Deal with the US. It's at least three weeks late

On Friday, the US Trade group said:

·       25% pharma tariffs would increase US drug costs by $51 bln annually

·       Pharma tariffs would raise US prices by as much as 12.9% if fully passed on

·       Pharma tariffs would increase US production costs, reduce the competitiveness of US drug exports

On Friday, the USTR said:

·       Trump ultimately will determine whether to proceed with alternative arrangements for nations that could eliminate or reduce the current 10% duties

·       It is constantly engaged with Japan & other countries in reciprocal trade talks

On Friday, the White House Sr. Adviser Hassett said:

·       I expect there will be positive news soon on trade

·       Many nations have asked to meet Trump in Rome

·       What Bessent said today is an accurate read

·       Trade relations will be better a year from now

On Friday, the US Agriculture Secretary Rollins said:

·       We're ready to provide a stopgap for farmers hit by tariffs

·       I hope the farmer stopgap won't be necessary

On Friday, China said:

·       China and the US are not having any consultations or negotiations on tariffs- China's Foreign Ministry on trade talks with the US

·       On tariff exemptions on some US goods: I'm not familiar with specifics, I refer you to competent authorities

·       China's trade frictions have entered a high-intensity stage and are facing difficulties and challenges - Commerce Ministry Statement.

·       We must be confident and adopt strategic approaches - Commerce Ministry Statement

·       China and the US not having any talks on tariffs; the US should stop creating confusion -Chinese Embassy.

The US may have created a global template for tariff talks with all trading partners-WSJ

The United States Trade Representative's (USTR) office has reportedly developed a template to streamline trade negotiations amid President Trump’s reciprocal tariff policies, as reported by the Wall Street Journal on April 25, 2025. This framework aims to set common terms for staggered negotiations with multiple trading partners, addressing the global trade disruptions caused by U.S. tariffs, which include a 10% baseline tariff on most imports and higher duties on specific countries, such as 145% on Chinese goods.

The global template outlines broad negotiation categories, including tariffs and quotas, non-tariff barriers (e.g., regulations on U.S. goods), digital trade, rules of origin, and economic security issues. U.S. officials plan to tailor demands for individual nations within these categories, with negotiations already underway with over 50 countries, including Japan, South Korea, and Switzerland, following Trump’s tariff announcements. The broad categories for negotiation are tariffs and quotas, non-tariff barriers to trade, digital trade, rules of origin for products, economic security, and other commercial issues, said people familiar with a draft document outlining the negotiating terms. However, they added that the document is subject to change as the administration of United States President Trump gets more information.

The US plans to negotiate with 18 of its major trade partners over the next two months, with six partners planned to come for talks during the first week, followed by six more in the second week and six more in the third week, with the pattern repeating until the administration's July 8 deadline.

Trump alleged Chinese trade restrictions and demanded opening-up

President Trump has repeatedly alleged that China imposes unfair restrictions on U.S. goods, contributing to a huge trade imbalance and justifying his administration’s aggressive tariff policies. He has claimed that China exploits the U.S. through trade practices, including high tariffs, non-tariff barriers, and intellectual property theft, which he argues harm American businesses and workers. Specifically, Trump has pointed to China's restrictions on U.S. agricultural products, energy, and high-tech goods, as well as its dominance in critical supply chains like rare earth minerals. For instance, he has linked tariffs to issues like the flow of fentanyl from China, framing trade measures as a tool to address both economic and security concerns. His administration has also accused China of using export controls on critical materials to retaliate against U.S. policies, further escalating tensions.

Will China ease its access to trade restrictions for foreign entities?

The most restricted sectors in China for imports from the U.S. or other countries and for private business activity are telecommunications, media and entertainment, defense and aerospace, and, to a lesser extent, energy and high-tech industries. These face a combination of state monopolies, high tariffs, non-tariff barriers, and FDI restrictions that render them nearly inaccessible. Agriculture is selectively restricted, particularly for U.S. goods, due to trade war retaliation. While no sector is entirely closed, the practical barriers in these areas create an environment where foreign and private participation is minimal or infeasible.

Key Sectors with Significant Chinese Restrictions

News Media & Publishing: Severely Restricted

·       Foreign companies are not allowed to operate independent news outlets in China.

·       The government controls all major news agencies, newspapers, and broadcast media.

·       Book publishing and film distribution are tightly regulated and require state-owned or state-approved partners.

·       Foreign publications can only enter the market through limited licensing deals, often censored or heavily edited.

·       Publishing (books, newspapers, and magazines) and internet content (e.g., streaming platforms, and social media) are tightly controlled, with foreign companies like Netflix or Google barred from operating independently.

·       Foreign books, especially children’s books, face fewer tariffs but are subject to rigorous content reviews.

·       Private businesses in China, including domestic firms, must comply with strict censorship laws and obtain licenses, making it difficult to operate independently of state influence.

·       The Cybersecurity Law and Data Security Law impose additional barriers, such as data localization requirements.

Internet & Digital Platforms: Severely restricted for imports and foreign/private participation

·       Major U.S. tech platforms like Google, Facebook, YouTube, Twitter, and Instagram remain banned.

·       Foreign companies cannot operate search engines, social media, or video streaming platforms without joint ventures under Chinese oversight.

·       The Chinese government maintains a strict Great Firewall to control the flow of information.

·       China imposes strict quotas on foreign films (currently around 34 per year, with additional revenue-sharing restrictions) and heavily censors content, limiting U.S. and other foreign film imports.

·       Recent retaliatory measures in April 2025 reduced U.S. film imports further, targeting the entertainment sector symbolically.

·       Foreign media imports are minimal, and private businesses face significant regulatory hurdles, effectively closing the sector to non-state actors.

Education Content Providers: Partially Restricted

·       Foreign educational institutions cannot operate independently in China

·       Online education platforms from abroad must partner with a local Chinese firm, and even then, their content is subject to review and censorship

These sectors are considered sensitive by the Chinese Communist Party due to their potential influence on public opinion, political ideology, and national security.

Financial Services: Partially Restricted

·       Banks: Foreign banks can operate in China, but they face restrictions on scope, and licensing, and often can't compete equally with state-owned banks

·       Insurance & Asset Management: More open than before, but local partnerships or heavy compliance are often required

·       Stock and bond trading: China has opened up more in recent years, but foreign ownership limits and regulatory hurdles remain; short sellers at the time of any crisis may end up in prison for the rest of their lives!

Agriculture & Food Products: Certain Products Selectively restricted with non-tariff technical barriers.

·       Imports: Many U.S. agri products like soybeans, corn, and meats are allowed, but subject to tariffs, quotas, and non-tariff barriers (e.g. inspections, safety certifications)

·       Biotech Crops: GMOs are tightly restricted. U.S. biotech firms can’t easily sell seeds or tech without government approval, which is rarely granted

·       China has imposed import suspensions and high tariffs on U.S. agricultural products like soybeans, poultry, and beef as part of trade war retaliation. For example, on March 4, 2025, China revoked import approvals for three major U.S. soybean exporters, and tariffs of 15% were added on products like chicken and corn.

·       Non-tariff barriers, such as phytosanitary regulations and technical standards, are used to favor domestic producers or imports from non-U.S. countries like Brazil for soybeans.

·       Private businesses in China can engage in agriculture, but state policies prioritize food security and local production, limiting foreign competition in sensitive areas like grain and dairy.

·       While not entirely closed, U.S. agricultural imports face significant disruptions, and foreign/private participation is constrained by regulatory barriers.

Automotive Industry: Partially Restricted

·       Foreign automakers (e.g. Tesla, BMW) can now have wholly-owned factories in China — a shift from older rules requiring joint ventures (JVs)

·       But New energy vehicles (NEVs) are prioritized, and companies may face regulatory hurdles, especially if they compete with domestic EV brands like BYD or NIO.

Telecommunications & Cloud Computing: Highly restricted for foreign participation and imports

·       Foreign firms cannot own more than 50% of telecom operators

·       Cloud services like Amazon AWS, and Microsoft Azure must partner with Chinese firms like Sinnet or 21Vianet to operate

·       Data localization and cybersecurity laws heavily restrict foreign control over infrastructure

·       China’s telecommunications sector, particularly basic services like mobile and internet networks, is dominated by state-owned enterprises (SOEs) such as China Mobile, China Telecom, and China Unicom.

·       Foreign companies are largely barred from operating in this sector due to national security concerns and strict licensing requirements.

·       Imports of telecommunications equipment (e.g., 5G infrastructure) face stringent regulations, including mandatory technology transfers and local content requirements.

·       Foreign firms like Nokia or Ericsson face significant hurdles in competing with domestic giants like Huawei.

·       Private businesses in China, even domestic ones, face barriers to entering this sector due to state control and the need for government approvals, which are rarely granted to non-SOEs

·       This sector is effectively closed to meaningful imports or private competition, with limited exceptions for niche value-added services (e.g., cloud computing under joint ventures.

Healthcare & Pharmaceuticals: Partially restricted

·       Foreign pharmaceutical companies can sell drugs in China but face long approval timelines and local clinical trial requirements.

·       Hospitals and clinics: Mostly dominated by public institutions; foreign investment allowed only through joint ventures, and in limited regions

Energy (Oil and Gas Exploration and Certain Utilities): Partially restricted, with significant barriers to imports and private participation

·       China’s oil and gas exploration and upstream production are dominated by SOEs like CNPC, Sinopec, and CNOOC.

·       Foreign companies can participate in joint ventures but face restrictions on majority ownership and technology transfers.

·       Imports of U.S. oil and gas (e.g., LNG, crude oil) have faced retaliatory tariffs (e.g., 15% on LNG and 10% on crude oil in February 2025) and suspensions, particularly in response to U.S. tariffs.

·       China has halted imports of U.S. oil and gas, though this is not a permanent closure but a trade war tactic.

·       Private businesses in China are limited in upstream oil and gas due to state control, though downstream activities (e.g., refining) are more open.

·       Electricity generation and distribution, especially in nuclear and large-scale hydropower, are also state-controlled, limiting private and foreign involvement.

·       While not fully closed, high barriers and state dominance make this sector challenging for imports and private firms.

High-Tech and Strategic Industries (Semiconductors, EVs, and AI): Increasingly restricted due to national security and self-sufficiency goals

·       China’s semiconductor and AI sectors are heavily protected to achieve technological self-reliance under the 14th Five-Year Plan (2021-2025)

·       Foreign companies face export controls, mandatory joint ventures, and technology transfer requirements.

·       U.S. firms like Intel or Nvidia are targeted by investigations or restrictions (e.g., Google’s anti-monopoly probe in April 2025) as a part of a retaliation strategy by China on the US

·       Electric vehicles (EVs) face import restrictions through subsidies for domestic producers (e.g., BYD) and technical standards that disadvantage foreign models.

·       Imports from the U.S. or EU are minimal due to cost and regulatory hurdles

·       Private businesses in China, especially domestic tech firms, thrive but face increasing Party oversight, as seen in Xi Jinping’s push for Party integration into corporate governance

·       Foreign private firms are effectively sidelined.

·       These sectors are not fully closed but are heavily tilted toward domestic players, with imports and participation severely limited.

Defense and Aerospace: Effectively closed to imports and private participation.

·       China’s defense sector, including military technology and aerospace, is controlled by SOEs and closed to foreign companies due to national security.

·       Exports to U.S. defense firms are restricted (e.g., 15 U.S. defense companies faced export controls in March 2025)

·       Imports of civilian aerospace products (e.g., Boeing aircraft) are subject to political leverage, with China halting U.S. aircraft imports in April 2025 as a trade war response.

·       Private businesses, even domestic ones, are excluded from core defense activities, though some private firms supply dual-use components under strict oversight.

·       This sector is virtually closed to imports and private activity, with rare exceptions for civilian aerospace under controlled conditions.

Broader Context and Nuances: As noted in historical analyses, China is not a closed economy but uses protectionist measures strategically. No sector is entirely barred from all imports or private activity, except during trade war times; but it creates de facto closures in sensitive areas.

FDI Restrictions: China’s Negative List for Foreign Investment (updated periodically) restricts or prohibits FDI in sectors like telecommunications, media, and defense. Even in “open” sectors, joint venture requirements and technology transfers limit foreign control.

Private Sector Challenges: Domestic private businesses face fewer restrictions than foreign firms but are increasingly subject to Party control, as seen in Xi’s 2016 policy integrating Party leadership into corporate governance. This blurs the line between private and state activity.

Global Comparison: While China restricts sectors like media and telecom more than most open economies, similar protections exist elsewhere including India and also the U.S. like tariffs on steel or bans on foreign telecom equipment). However, China’s scale and state dominance make its restrictions more impactful.

In Summary:

The notion of a “closed” sector oversimplifies China’s approach. Rather than outright bans, China employs a web of tariffs, regulations, and state control to prioritize domestic industries and national security. Sectors like telecommunications, media, and defense are effectively closed due to their strategic importance, while agriculture and high-tech face-selective barriers to balance self-sufficiency with global integration.

The trade war has amplified restrictions on U.S. imports, but these are tactical rather than permanent closures. For private businesses, both foreign and domestic, the real challenge is navigating an opaque regulatory environment and increasing Party influence, which stifles competition in state-dominated sectors.

The most restricted sectors in China for imports from the U.S. or other countries and for private business activity are telecommunications, media and entertainment, defense and aerospace, and, to a lesser extent, energy and high-tech industries. These face a combination of state monopolies, high tariffs, non-tariff barriers, and FDI restrictions that render them nearly inaccessible.

Agriculture is selectively restricted, particularly for U.S. goods, due to trade war retaliation. While no sector is entirely closed, the practical barriers in these areas create an environment where foreign and private participation is minimal or infeasible.

Conclusions:

China may indeed open up some sectors for active private and foreign participation, but Trump can’t force China or even India to change their mixed PPP (public-private participation) economy to only private like in the US. The Chinese model of state-sponsored capitalism along with private participation in an autocracy may not be possible for India or the US. But even in electoral politics and democratic countries like India, the US may learn from the Chinese model of development involving state and local government more for rapid execution of various infra projects. China uses fiscal stimulus for developing infra rather than using it as ‘helicopter money’ (like the US or partly India). Thus China has better productivity than India or even the US.

China’s partial dependence on the West is a strategic vulnerability in high-tech sectors like semiconductors, aerospace, and machinery, where the U.S. and its allies hold a technological edge. These dependencies are partial but critical, as China can produce mid-range alternatives but struggles with cutting-edge quality and scale. Reliance on Russia is far less significant, limited to energy, raw materials, and legacy military systems, reflecting Russia’s role as a geopolitical hedge rather than a technological necessity. China’s aggressive localization, spurred by trade war pressures, is narrowing these gaps, but full self-sufficiency is years away due to Western sanctions, certification hurdles, and innovation lags. Conversely, China’s control over rare earths and manufacturing capacity gives it counter-leverage, creating a complex interdependence with the West.

The US and China have been dependent on each other for decades and may remain the same without any real possibility of a complete decoupling or isolation of each other in trade blocks. Both the US and China are moving towards the start of formal negotiations on Trade Deal 2.0 irrespective of who blinks first. Although China may further liberalize and open its economy for private and foreign business, Trump can’t change the internal system of China including state-sponsored capitalism with a touch of socialism/communism. China is also a market economy in PPP mode.

Although Trump now trying to transform the US into a fully private market economy, history shows that, whenever some financial crisis stuck, the US and also almost all other so-called capitalist countries resort to socialism including ‘helicopter money’ and central bank money printing. Thus China will open up its economy gradually in line with its overall strategy, not under Trump’s gunpoint and bullying strategy.

Trump has to maintain a big departmental shop for America-not only for consumer goods, but also for various industrial goods and raw materials. As the US currently does not manufacture most of these merchandise goods in adequate quantities, Trump has no other option, but to continue importing from China, Mexico, Vietnam, and other countries. Thus Trump is now trying to force various manufacturing companies to set up factories in the US and produce tax/tariff-free goods. However, it will take time for Trump to set up a fully integrated US supply chain without any import dependencies on a country like China.

Thus Trump has to continue to import almost 50% of US merchandise goods requirement, both consumers and industrials. At least for the next few years till his 2nd term ends by Dec’28. Till Trump makes the US a fully industrial and manufacturing hub like China, even at a smaller scale (mini-China), Trump has to continue importing to fill up his grand America store. Trump’s narrative is that exporters have to pay his tariffs and in in-fact paying billions of dollars to the US, something which has never happened in the last century. But the reality is that US importers are placing orders with exporters and its US importers and eventually US consumers are paying Trump tariffs, not China or any other exporters.

Bottom line:

Trump has to set his own price/tariff rag for his big, beautiful American superstore as suppliers will not pay his tariffs; American importers and consumers will pay and Trump must continue importing to keep the US economy running.

Market impact:

On Friday, Wall Street Futures gained for the 4th consecutive day on signs of real progress in US-China trade talks irrespective of whether Trump called Xi or vice-versa or any other telephonic calls happened at all. The US-China back-channel talks may be going on without intense media coverage for China’s domestic political compulsion and audience. The nationalistic Chinese public does not want to see their Supreme Comrade Xi cave at Trump’s gunpoint.

 On Friday, the broader S&P 500 rose around 0.74%, the tech-savvy Nasdaq 100 surged 1.14%, while the real economy-savvy Dow Jones 30 edged up 20 points. Earlier in Friday's EU session, Wall Street Futures were undercut by China’s denial of any trade talks with the Trump admin. Trump’s suggestion of 50% tariffs as a "total victory" added uncertainty, while Beijing disputed claims of ongoing talks, offsetting optimism from China’s decision to exempt some US goods from tariffs.

But later, Trump’s call/comments for opening up of Chinese economy for more American goods as a ‘big win’ may be indicating active back-channel talks between the two largest economies in the world, controlling almost 45% of the global GDP. Overall, Wall Street surged for the week on the progress of US-China back-channel trade talks and fading concern of Fed independence- with the S&P 500 jumping 4%, the Nasdaq-100 soared 6%, and the Dow-30 gained 2%.

On Friday, Wall Street was boosted by consumer discretionary, techs, communication services, healthcare, and industrials, while dragged by materials, banks & financials, utilities, consumer staples, real estate, and energy to some extent. Dow Jones (DJ-30) was boosted by NVIDIA, Merck & Co, IBM, Amazon, Salesforce, Microsoft, Boeing, P&G, Cisco, and Apple, while dragged by Verizon, Nike, United Health, 3M, American Express, Coca-Cola, Sherwin-Williams, Honeywell, Hume Depot, Travelers, JPM, and Chevron.

Google parent Alphabet surged on the upbeat report card, its maiden dividend, and a $70 billion stock buyback plan. Tesla soared after new self-driving car rules were unveiled and as Musk promised to focus more on business rather than Trump’s politics. Also, the Trump admin may exempt tariffs on automobile parts for its Make in America of Cars plan. Intel plunged on subdued report card including weak guidance.  T-Mobile slid on soft subscriber growth.  The market is now waiting for report cards from Amazon, Apple, and Meta next week—fellow members of the ‘Magnificent Seven’ apart from the ongoing deluge of Trump trade talks.

Gold slips on apparent progress of US-China back-channel trade talks, overall progress in trade negotiation global format and Ukraine war ceasefire; USD, UST also gained on the fading concern of an all-out Trump trade war and Trumpcession; GBP, EUR also edged down, while Oil gained. Buy weekly, oil slumped as OPEC may hike production again in the coming days, while a full Ukraine war ceasefire and withdrawal of Russian oil sanctions may also boost the oil supply.

Weekly-Technical trading levels: DJ-30, NQ-100, and Gold

Looking ahead, whatever the fundamental narrative, technically Dow Future (CMP: 40250) now has to sustain over 41200 for a further rally towards 41500/42000-42300-43300/44600, and even 45200 in the coming days; otherwise sustaining below 41100/40700,-40000 DJ-30 may again fall to 39700/38600-38000/37700-37300/37000 in the coming days.

Similarly, NQ-100 Future (19500) has to sustain over 19700 for a further rally to 20000/20550-20900/21400 and even 22000-22400 in the coming days; otherwise, sustaining below 19650, NQ-100 may again fall to 19100/18800-18600/18000-17600/16400 and 16200-15800 in the coming days.

Also, technically Gold (CMP: 3317) has to sustain over 3335-3370 for a further rally to 3400/3425-3450/3505*, and even 3525/3555 in the coming days; otherwise sustaining below 3325, Gold may again fall to 3300/3275-3255/3200, Gold may further fall to 3180/3130-3065/2990 and 2960/2900*-2800/2750 in the coming days.