Dow And S&P Stocks Improve Amid Hopes For Xi-Trump Meeting

Dow Jones
A screen displays the Dow Jones Industrial Average after the close of trading on the floor at the New York Stock Exchange (NYSE) in New York, U.S., June 4, 2019. (Photo: REUTERS/Brendan McDermid)

Multiple stock indexes saw slight but meaningful increases on Monday as investors around the world expressed hopes for a positive close to the meeting between Chinese President Xi Jinping and U.S. President Donald Trump at the G20 Summit this weekend.

According to CNBC, the S&P 500 index saw a hike of 0.1 percent, the Dow Jones Industrial Average rose by 32 points, as largely pulled up by United Technologies. Nasdaq Composite saw an improvement of 0.2 percent, while Deere stocks climbed by 0.7 percent.

Shortly after it was confirmed that the two leaders will meet at the upcoming summit, stocks were mixed last week. However, as the G20 in Osaka draws near, investors are starting to get bullish albeit on a gradual and still weak level.

Managing Director of Global Political Research at TS Lombard, Christopher Granville, said in a note that financial markets showed some sort of vitality after the two sides agreed on a "bilateral" meeting that could hopefully open doors for new trade negotiations.

Granville further noted that the upcoming meeting between Xi and Trump will most likely be similar to the one held in Buenos Aires. At that time, no official trade deal was reached but the leaders decided to hold off tariffs.

Furthermore, the Buenos Aires meeting gave birth to new rounds of negotiations. Market analysts are expecting a similar ending to the highly anticipated Xi-Trump meeting that could lighten up investor activities.

Meanwhile, not all analysts are expecting good to come out of the upcoming meeting between the leaders of two of the world's largest economies. Some are unsure which side of Trump will be displayed at the G20 Summit.

Some experts think it could be the American chief who could push China to the limits even if it means putting the global economy at risk. Others argue that he may have a softer stance this time, especially with many U.S. sectors complaining of feeling the heat amid the trade war.

What analysts agree on is the high chances that a trade deal will not be reached during the Japan meet-up. Instead, the two sides will most likely agree on something regarding tariffs but the gap on primary state standards will not be narrowed, economic analysts noted.

Uncertainty is the biggest issue that analysts have pointed out ever since the White House started slapping tariffs. Since both sides have displayed signs of battling it out to the end, it is unclear how markets will react during and after this week's Xi-Trump meeting.

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