Breaking: Stocks Up After Trump/Xi Finally Hold Call. Who Called?

The stock market has been slightly positive today and is trending upwards due to Chinese media reporting that President Donald Trump and China’s President Xi Jinping have held a phone call. In late April, Trump claimed that he had already held a phone call with Xi, but he didn’t clarify if that happened after he imposed tariffs, and the market did not react much to the news.

However, now Chinese media and China’s Embassy in the U.S. have reported that both of them have held a call today. They claim that the call happened on Trump’s request. On Wednesday, Trump posted on Truth Social and said that Xi was “VERY TOUGH, AND EXTREMELY HARD TO MAKE A DEAL WITH”. A day earlier, Politico reported that Trump was “obsessed with having a call with Xi”. Still, there are no details beyond the Chinese claim on who initiated the call.

Here’s a market update as of 11:00 AM (ET) today.

• The S&P 500 is up 5.81 points, or 0.09%.
• The Nasdaq Composite is up 61.09 points, or 0.31%.
• The Dow Jones Industrial Average is up 18.35 points, or 0.004%.

U.S.-China Trade News

China’s President Xi and Trump have agreed to start a new round of talks “ASAP,” according to CCTV. Xi said that the “two sides should enhance exchanges in diplomatic, economic, trade, military, and law enforcement,” and that “Trump is welcome to visit China again,” per Xinhua. He also told Trump that China implemented the Geneva agreement, which is the trade truce both countries reached earlier in Geneva.

CCTV reported that Xi said, “The U.S. should remove negative measures on China,” and that both countries should increase cooperation.

On Truth Social, Trump wrote the following:

“I just concluded a very good phone call with President Xi, of China, discussing some of the intricacies of our recently made, and agreed to, Trade Deal. The call lasted approximately one and a half hours, and resulted in a very positive conclusion for both Countries. There should no longer be any questions respecting the complexity of Rare Earth products. Our respective teams will be meeting shortly at a location to be determined. We will be represented by Secretary of the Treasury Scott Bessent, Secretary of Commerce Howard Lutnick, and United States Trade Representative, Ambassador Jamieson Greer. During the conversation, President Xi graciously invited the First Lady and me to visit China, and I reciprocated. As Presidents of two Great Nations, this is something that we both look forward to doing. The conversation was focused almost entirely on TRADE. Nothing was discussed concerning Russia/Ukraine, or Iran. We will inform the Media as to scheduling and location of the soon to be meeting. Thank you for your attention to this matter!”

Macros

The macro figures coming in today are slightly on the bearish side. Jobless claims are slightly higher than expected, though continued jobless claims are lower. That said, the trade balance data is good. It shows that there has been a positive shift in trade flows.

• U.S. Productivity Revised to -1.5% vs. the forecast of -0.8%.
• U.S. Initial Jobless Claims at 247,000 vs. the 235,000 forecast.
• U.S. Continued Jobless Claims at 1.904 million vs. the 1.91 million forecast.
• U.S. Trade Balance figures came in at -$61.6 billion vs. the -$66 billion forecast.

The stock market has recently been getting solid tailwinds from falling Treasury yields as well. Investors aggressively bought Treasuries on Wednesday as data came in weak. The 10-year Treasury now yields 4.37%, whereas the 5-year Treasury has dropped to 3.95%. Those have gained slightly, but it’s still a positive for stocks.

Other Assets

• Gold is flat today at $3,401.
• Crude Oil Futures are up 1.4% to $63.7.
• Natural Gas Futures are down 0.8% to $3.68.
• Bitcoin is flat at $104,748.

The image featured at the top of this post is ©Greg Bowker - Pool/Getty Images.