This archive report was first published on 15 August 2019.
On Thursday, stocks in the United States rose, driven by upbeat economic data and a conciliatory statement from the Chinese government. The S&P 500 index rose about half a percent at the start of trading.
According to the Commerce Department, retail sales in the United States climbed in July. Walmart reported stronger than expected earnings and raised its outlook for sales this year. The Chinese e-commerce giant Alibaba also released strong financial results.
A statement from the Chinese government, released just before the start of Thursday's trading in the United States, helped ease concerns. Hua Chunying, the foreign ministry spokesperson, said, 'We hope the U.S. can work in concert with China to implement the two presidents' consensus that was reached in Osaka, and to work out a mutually acceptable solution through equal-footed dialogue and consultation with mutual respect.'
However, investors face conflicting signals on the state of the trade dispute. Earlier Thursday, a different statement from China appeared to ratchet up the tension by threatening a response should Mr. Trump carry out his threat to impose 10 percent tariffs on billions of dollars of Chinese imports as of Sept. 1.
On Wednesday, the S&P 500 index fell 2.93 percent, one of its worst days this year. Investors have other issues on their mind as well, including the possibility of a recession in the United States. Bond markets have begun to hint that a recession could come soon.
The 30-year bond yield fell below 2 percent for the first time on record, reflecting increased demand for Treasuries as investors pull their money from riskier stocks, said Joshua Mahony, a senior market analyst at IG Group in London. 'Yields are falling across the board, it's a flight to safety,' he said.
Markets were also hit on Wednesday by glum economic news from Germany and from China. Complicating the outlook is the situation in Hong Kong, a semiautonomous Chinese territory, where residents have been protesting China's growing involvement in daily life.
