synopsis

The rebound in the financial markets since last week is predicated on hopes of a potential trade deal between the two countries.

China has yet again denied any dialogue with the U.S. regarding the ongoing tariff impasse, even though President Donald Trump has asserted that rudimentary discussions are underway.

Late Monday, Chinese Foreign Ministry spokesperson Guo Jiakun told reporters at a press conference, "I would like to reiterate that China and the United States have not conducted any consultations or negotiations on the issue of tariffs."

The spokesperson also refuted Trump's claim in a Times interview that his Chinese counterpart, President Xi Jinping, had called on him. "As far as I know, the two heads of state have not had any phone calls recently."

When a reporter asked about U.S. Treasury Secretary Scott Bessent's comments in an ABC News interview that China's denial was due to them "playing to a different audience," Jiakun said, "There are no winners in tariff wars."

"If the U.S. really wants to resolve the issue through dialogue and negotiation, it should stop threatening and blackmailing and engage in dialogue with China on the basis of equality, respect and mutual benefit."

Incidentally, in the ABC News interview, Bessent said he expects China to come around. "China has no business model," he said. 

"Their business model is predicated on selling cheap, subsidized goods to the U.S. And if there's a sudden stop in that, they will have a sudden stop in the economy, so they will negotiate."

Bessent said he has had negotiations with his Chinese counterparts at Washington D.C. on the sidelines of the IMF-World Bank meetings, adding that the talks centered around traditional topics like financial stability and global economic early warnings.

The Treasury Secretary, however, said he didn't know whether Trump had spoken with Xi. "I know they have a very good relationship and a lot of respect for each other," he added.

Later, in an interview with CNBC, Bessent said the onus of de-escalation lay with China.

Despite China's repeated denial of trade talks, the country has recently taken a positive step by taking some essential U.S. imports off the 125% tariff bucket.

The financial markets' rebound since last week is predicated on hopes of a potential trade deal between the two countries. 

For the year-to-date period, the SPDR S&P 500 ETF (SPY) and the Invesco QQQ Trust (QQQ) ETF are down over 5.8% and 7.4%, respectively.

For updates and corrections, email newsroom[at]stocktwits[dot]com.<