Talks between mid-level US and Chinese officials in Beijing were extended for a third day into Wednesday, adding to optimism fueled by tweets from Trump that the two sides are making progress toward an agreement.
A spokeswoman for the USA trade representative's office, which is leading the United States negotiating team, said talks would continue on Wednesday and "a statement will likely follow then".
"Talks with China are going very well!", Trump tweeted on Tuesday, the latest in a series of upbeat messages from him on the negotiations since both his meeting with Xi and the December market turmoil. It said Washington "cannot push China too far" and must avoid a situation that "spins out of control".
China's Commerce Ministry said ahead of the meeting that it would last only two days.
Word of progress briefly drove USA stocks higher in early morning trading but major indices soon pared much of those gains. Steven Winberg, assistant secretary for fossil energy, has told reporters that discussions will be extended for another day.
He declined to provide more details.
The temporary ceasefire came after the two sides imposed import duties on more than US$300 billion (S$ 407 billion) of each other's goods.
A U.S. guided-missile destroyer sailed near disputed islands in the South China Sea in what China called a "provocation" as United States officials joined talks in Beijing during a truce in a bitter trade war. "That's probably the easiest one to solve", Ross said.
Without a resolution, punitive United States duty rates on US$200 billion in Chinese goods are due to rise to 25 percent from 10 per cent on March 2.
The statement came as trade talks between China and the United States were under way in Beijing, the first round of face-to-face discussions since both sides agreed to a 90-day truce in a trade war that has roiled worldwide markets.
U.S. Trade Representative Robert Lighthizer, who Trump appointed to lead the China talks, is pressing for the U.S.to take a harder line in the negotiations.
"I don't see any linkage with the trade talks", said Ms Glaser, a senior adviser at the Center for Strategic and International Studies. The Trump administration also objects to Chinese industry development plans that Washington, Europe, Japan and other trading partners say violate Beijing's market-opening obligations.
Chinese Foreign Ministry spokesperson Lu Kang confirmed during a press conference later that day that the US sent a vessel into the area "without permission from the Chinese side".
The U.S. Navy deployed its Arleigh Burke-class guided-missile destroyer USS McCampbell into the contested waters just 12 nautical miles from Paracel Islands, one of the numerous land formations claimed by China as well as other nations in the region.
China has made "stern representations" to the United States after an American destroyer sailed through waters claimed by Beijing in the disputed South China Sea.
The US and its allies periodically send planes and warships through the area, which is claimed by China, to signal to Beijing their right under global law to pass through the waters.