Global markets are jittery about a collision between the world's two largest economic powers over China's huge trade surplus with the U.S. and Washington's claims that Beijing is stealing intellectual property and technology.
Top officials from the US and China have begun talks to sort out their trade differences, in particular to identify steps that address the concerns of US President Donald Trump on intellectual property and reduce the balance of trade, a media report said.
The White House is delaying a second round of payments from a $12 billion aid package for farmers stung by a trade dispute between China and the United States, amid optimism China will soon resume buying US soybeans, three sources familiar with the matter told Reuters.
After months of disagreements over trade, US President Trump and Chinese President Xi Jinping made a deal to stop new tariffs during their meeting in Argentina.
A Trump administration official earlier told Reuters that China's plan to cut auto tariffs was outlined in a phone call between Chinese Vice Premier Liu He, US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin.
In July, China had boosted the tariff on American-made cars to 40pc as part of retaliatory measures against the US.
"Whatever's good for this country, I would do", Mr Trump said, adding that trade talks with Beijing are under way via telephone and more meetings between U.S. and Chinese officials are likely to follow. The sector, which is heavily exposed to China, is among the most beaten-down this quarter.
Daimler AG, General Motors Co. and Tesla Inc. were among the manufacturers that gained on Tuesday after Bloomberg News reported that a proposal to eliminate the 25 percent surcharge slapped onto US -made cars this year has been submitted to China's cabinet. Cargill Inc. said earlier this month that the US has probably already missed the best chance to sell beans to China because of approaching South American harvests.
USA farmers welcomed the deals. That's piled pressure on companies that have relied on the country for growth amid declining sales in the U.S.
"It looks like we're back in business now", the second USA trader said.
US farmers stored soybeans after the fall harvest, instead of selling them to grain traders and processors, because of low prices and lack of alternative buyers.
"We expect China to resume purchases of other farm products from the United States, including corn", said Li. After a lengthy dinner with the Chinese President, Trump agreed to cancel an increase on Chinese import' tariff rates, which was scheduled to take effect in 2019.
"The Chinese evidently want the beans quickly as they have not been able to cover all their needs in South America", the European trader said. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.