Last Wednesday, the S&P 500 experienced a plunge as stocks slipped amidst reports that a deal between the United States and China might not be reached within this year. As a result, the index lost 11.72 points, or 0.4%, to conclude at 3,108.46. 

In the past weeks, market participants’ increasing optimism with regards to the two largest economies ending up with a trade agreement aided in breaking the ice for gains to flow in the market, particularly when it comes to the sequence of highs for the major indexes. However, this optimistic tone in the market was clouded on Wednesday as participants considered the impacts of more tariffs coming through in the following month.

On Thursday, stocks continued to drop as the standstill between the U.S. and China broadened outside trade, lowering the possibility of the first phase of the deal happening this year. Investors’ failed expectations of a trade agreement being reached by the middle of this month and the support U.S. lawmakers have provided for the people protesting in Hong Kong has led the development of the talks to be discontinued.

Meanwhile, stock futures for the S&P 500 were slightly lower, dropping in Asian trade as far as 0.6%. The index previously reached a record high back on Tuesday, founded on expectations of a deal being reached, but was driven off course by Washington’s action in relation to Hong Kong.

By: Cyril Latrice Cajanding