Daily U.S. and China Tariff News
The noise on U.S. tariffs against China continued on Wednesday. U.S. Commerce Secretary Lutnick said to reporters that “we have reached a framework to implement the Geneva consensus and the call between the two presidents.”
Lutnick said that representatives of each country will take the proposal back to their respective Presidents. If approved, they would implement a framework. Later in the day, Lutnick said that the trade talks were going “really well.”
Unfortunately, the comments conflict with President Trump’s post on Truth Social. Although the President said that the U.S. would get supplied with rare earths in China, the tariff rates are high. He said “We are getting a total of 55% tariffs, China is getting 10%. Relationship is excellent!"
A 55% tariff rate is a disaster for American consumers. By the end of the trading day, the S&P 500 (SPY) and Nasdaq (QQQ) closed lower while the Dow Jones ended flat. The indices gave up their gains for the day. Amazon (AMZN), Apple (AAPL), Walmart (WMT), and Costco (COST) fell.
In the military sector, Lockheed Martin (LMT) dropped by 4.26% to close at $456.60. The Pentagon cut its request for Air Force F-35s by half. They are now ordering 24, down from the 48 forecast last year.
Bond markets strengthened, led by the iShares 20+ Year Treasury Bond ETF. Yields fell when the government posted inflation rising by 0.1% M/M. This is below the 0.2% expected rate.
