Investors were very enthused today following the successful meeting between the U.S. and China at G20—rallying global markets.
- The annual G20 Summit—a forum for 19 of the world’s most influential countries plus the European Union—is being hosted in Bali this week on Tuesday and Wednesday.
- U.S. President Biden and Chinese President Xi Jinping hosted a meeting on Tuesday as part of the Summit, addressing recent tensions between both countries.
- The meeting was successful in opening discussions on food security and climate change between the two nations, although major issues like Taiwan’s sovereignty remain unresolved.
- Stocks rallied in markets across the globe as the hope of reduced tension excited the market, The New York Times reports.
Why it’s News
Both the U.S. and China have been ratcheting up tensions in the past year over American tariffs and Chinese human rights abuses. President Xi sees the U.S. as an aggressor against his country’s sovereignty and internal affairs.
As we previously reported, the U.S. has signaled its desire to open greater trade opportunities with the island nation of Taiwan—which China claims sovereignty over.
Today’s meeting cooled tensions for the moment, with President Biden confidently stating he doesn’t foresee China invading Taiwan in the near future. He also plans to dispatch Secretary of State Antony Blinken for a visit to China in early 2023.
Investors prefer the benefits of gridlock and peace in their decision-making, and with the threat of further tariffs or conflict momentarily off the table world markets rallied.
“Shares in Shanghai and Hong Kong closed higher, with Hang Seng’s Tech Index of Hong Kong-listed Chinese tech equities jumping 7.3% to extend a three-week rally. Adding to their enthusiasm: Beijing signaled it was shifting from its Zero Covid policy as cases rise in the southern manufacturing hub of Guangzhou. Nasdaq futures were also gaining, pointing to a strong open for the U.S. markets,” says The New York Times.