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Dow rallies 429 points after Xi Jinping calms trade fears

Chinese President Xi Jinping gave Wall Street a lift.The Dow rallied 429 points on Tuesday after Xi said in a ...

Posted: Apr 11, 2018 6:50 AM
Updated: Apr 11, 2018 6:50 AM

Chinese President Xi Jinping gave Wall Street a lift.

The Dow rallied 429 points on Tuesday after Xi said in a speech that the Chinese government plans to "significantly lower" tariffs on imported cars as part of efforts to further open China's economy.

The S&P 500 and the Nasdaq each climbed more than 1%. Automakers helped lead the charge: GM, Ford, Honda and Tesla all gained ground.

Related: How did China end up posing as the defender of global trade?

Xi's conciliatory speech cooled trade tensions between the United States and China. Investors hope Xi's plan will convince the Trump administration to move away from protectionism.

President Trump praised Xi on Twitter on Tuesday. "We will make great progress together!" he said.

"This could provide Trump with an opportunity to back down from his tariff threats while claiming a victory of sorts," Capital Economics' Julian Evans-Pritchard wrote in a research note Tuesday.

The United States-China spat has roiled markets in recent weeks.

Related: The stock market can't figure out Trump's trade policy

Investors fear a full-scale trade war could break out between the world's two largest economies and slow global economic growth.

Trump has proposed tariffs on up to $150 billion of Chinese goods. In retaliation, China said it planned to put $50 billion in tariffs on US planes, cars and soybeans.

Trump complained as recently as Monday about China's 25% tariff on foreign cars.

"Does that sound like free or fair trade," Trump tweeted. "No, it sounds like STUPID TRADE - going on for years!"

Xi didn't mention Trump or the United States in his speech, but he stressed the need for dialogue and warned against a "Cold War mentality."

Related: Head of world's largest hedge fund 'worried' about a trade war

Although Xi said lowering tariffs on imported cars was part of "a new phase of opening up" China, the Chinese government has mentioned the plan before.

When Trump visited China in November, Chinese officials pledged to "gradually and properly" reduce tariffs on imported vehicles. They didn't give a specific time frame.

"There was little in Xi's speech that we haven't heard before," Evans-Pritchard said. "What he has done, however, is cleverly combined existing reform pledges into a single package."

Related: How a US-China trade war could hurt (and help) others

Investors will now wait to see how the administration responds.

With midterm elections approaching in the fall and Trump's Midwest farm base caught in the US-China fight, "Trump will gladly take any bone that the Chinese throw his way," said Ed Yardeni, president of Yardeni Research. Trump admitted Monday that Chinese tariffs may hurt farmers, but said "we'll make it up to them."

Related: Trump promises to 'make it up' to farmers hit by China tariffs

Legal developments also loomed over the market for the second straight day.

The Dow lost most of its gains at the end of the day Monday as news broke that the FBI had raided the office and home of Michael Cohen, Trump's personal lawyer and confidant.

Stocks recovered Tuesday.

"Everybody slept on it and recognized that wherever this leads it's not likely to have a significant economic impact," Yardeni said.

-CNN's Jethro Mullen contributed to this story.

Mississippi Coronavirus Cases

Data is updated nightly.

Cases: 343505

Reported Deaths: 7543
CountyCasesDeaths
Hinds23932444
DeSoto23229283
Harrison20527329
Rankin15411291
Jackson15232252
Madison10959227
Lee10719179
Jones9047169
Forrest8723159
Lauderdale7884244
Lowndes7054151
Lamar702989
Lafayette6548124
Washington5595139
Pearl River5196152
Bolivar4954134
Oktibbeha494398
Panola4771112
Warren4728128
Marshall4701106
Pontotoc447773
Union433279
Monroe4330137
Neshoba4281181
Hancock428088
Lincoln4176116
Pike3667113
Leflore3627125
Tate353388
Alcorn350974
Sunflower347694
Scott341176
Adams340988
Yazoo339376
Copiah324968
Simpson322891
Itawamba314680
Coahoma314085
Tippah306568
Prentiss298863
Covington293484
Leake285475
Marion284181
Wayne277543
George272251
Grenada269488
Newton262364
Tishomingo239770
Winston236784
Jasper230648
Stone229637
Attala226373
Chickasaw219060
Holmes200174
Clay197654
Clarke186880
Tallahatchie183742
Calhoun181332
Smith179235
Yalobusha171540
Walthall145748
Lawrence142826
Greene140134
Amite137543
Noxubee135235
Perry133538
Montgomery133044
Carroll126431
Webster121232
Jefferson Davis116734
Tunica114227
Benton106725
Claiborne105331
Kemper102429
Humphreys100133
Franklin87923
Quitman84719
Choctaw82619
Wilkinson78032
Jefferson71328
Sharkey51618
Issaquena1736
Unassigned00

Alabama Coronavirus Cases

Cases: 577463

Reported Deaths: 11510
CountyCasesDeaths
Jefferson841981589
Mobile47171860
Madison37047533
Tuscaloosa26915465
Shelby26873256
Montgomery25918625
Baldwin24499328
Lee16949181
Calhoun15252332
Morgan15017290
Etowah14778370
Marshall12933235
Houston11774292
Elmore10761217
St. Clair10617252
Limestone10574158
Cullman10363205
Lauderdale10083254
DeKalb9382191
Talladega8836188
Walker7681287
Autauga7479114
Jackson7317117
Blount7266139
Colbert6635142
Coffee6163132
Dale5453117
Russell470642
Chilton4682117
Covington4649125
Franklin450081
Tallapoosa4440156
Escambia427882
Chambers3898125
Dallas3717163
Clarke367763
Marion3427106
Pike327879
Lawrence3225101
Winston294973
Bibb284565
Geneva276383
Marengo259967
Barbour246261
Pickens240062
Butler238272
Hale232778
Fayette225264
Henry209245
Monroe197241
Randolph196744
Cherokee196348
Washington180139
Macon168752
Crenshaw165558
Clay163759
Cleburne160245
Lamar149938
Lowndes144854
Wilcox130531
Bullock126142
Conecuh119630
Coosa116929
Perry109928
Sumter109032
Greene98736
Choctaw64325
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Columbus
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