US President Donald Trump said on Thursday that it was "unlikely" he would meet with his Chinese counterpart Xi Jinping before a crucial March deadline, a significant change in the prospects for ending a trade war that has roiled the global economy.
Mr Trump responded "no" and shook his head on Thursday when reporters at the White House asked him if he would meet Mr Xi this month. Officials on both sides had said the two presidents were scheduled to be face-to-face later in February but now, CNBC says a meeting before the March 2nd deadline is unlikely.
While the United States has said it is a hard deadline for the tariffs, Mr Trump has also suggested he could agree to extend negotiations beyond the month's end if progress is made. The broad S&P 500 index shed 0.9 percent to 2,706.05.
Trump said last week he would meet Xi again to finalise the final deal.
Last week, Trump and Chinese officials held the second round of talks in Washington but they released few details about progress in their talks.
"I could see where that would impact the markets because, obviously, we had a lift in the month of January from optimism surrounding these trade talks", said Peter Jankovskis, co-chief investment officer at OakBrook Investments LLC in Lisle, Illinois. The benchmark 10-year yield slid four basis points to 2.66 percent, the lowest in almost a week.
ENERGY: U.S. crude oil lost 21 cents to $52.43 per barrel in electronic trading on the New York Mercantile Exchange.
One senior administration official said the decision not to go ahead with a meeting between Xi and Trump before March 1 should not be read as a sign the talks were breaking down.
The U.S. agreed to suspend its plans to raise tariffs on $200 billion of Chinese goods to 25% from 10% to give negotiators a chance to settle issues. "They're making a mistake because they need to be prepared", he said. They include US demands that China boost imports of USA products, and Chinese government and corporate pressure on US firms to transfer their technology to Chinese partners.
The United States is pressing China to make major reforms, including on structural issues related to how it treats US companies doing business there.
While China has offered to buy more United States soybeans and beef, officials have yet even to agree on a draft of a deal that would address key USA concerns, according to media reports.
But top White House economist Larry Kudlow told Fox Business on Thursday that while Trump was "optimistic" about prospects for a deal, there remained a "sizeable distance" separating the two sides. Three sources familiar with the matter indicated that report was wrong.