(Bloomberg) — U.S. stock index futures swung on Monday morning as investors struggled with the increasingly complex task of assessing the impact of a trade war on the economy and corporate profits.
Futures, which surged after U.S. President Donald Trump said China wanted to restart trade talks, gave up some gains after Global Times’s editor-in-chief Hu Xijin said the contact doesn’t have the significance Trump suggested.
“Based on what I know, Chinese and U.S. top negotiators didn’t hold phone talks in recent days. The two sides have been keeping contact at technical level, it doesn’t have significance that President Trump suggested,” Hu wrote in a tweet.
September contracts on the S&P 500 were up 0.4% at 06:36 a.m. in New York after gaining as much as 1.2%, while those on the Dow Jones and the Nasdaq 100 were up 0.6% and 0.8% respectively. The swings followed a sell-off on Friday that sent benchmark gauges to their third 2%-plus plunge of August, now likely to be the second down month for equities of 2019.
Trump said on Monday that China has asked to re-start trade talks, hours after Beijing’s top negotiator publicly called for calm in response to a weekend of tit-for-tat tariff increases that sent global stocks plunging.
“China called last night our trade people and said let’s get back to the table,” Trump said on the sidelines of the Group of 7 meeting in Biarritz, France. “They understand how life works.” The U.S. president later said in a tweet that he has “great respect for the fact that President Xi & his Representatives want ‘calm resolution.’”
Stocks plunged Friday after Trump warned of an unspecified response to China’s plan to slap new tariffs on $75 billion of U.S. goods. After markets closed, he said he’d hike existing tariffs, applied to about $250 billion in Chinese goods, to 30% from 25% as of Oct. 1. He also said a new round on $300 billion in goods will be taxed at 15%, up from 10%.
(Updates with latest news developments, index levels.)
–With assistance from Sarah Ponczek and Filipe Pacheco.
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