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Jacob Sonenshine: Let's get you all caught up on trade. There's been a lot of back and forth in the last several weeks. Let's go back a few weeks before we get to Wednesday. Few weeks ago, president Trump said there's no quote need for a trade deal pre 2020 election. Days ago, China said, we are not considering any longer a broad-based trade agreement. Wednesday, China says, we are willing to have a partial deal. That's according to a Bloomberg report on one condition that there are no further tariffs put in place. We have tariffs set to go into effect in October. We are in October, but in the middle of October and then in December, those are not allowed if there's going to be a partial trade deal, says China. Stocks S and P 500 up 0.96%, all three major US indices up on Wednesday in the last month or so. Actually in the last month, the S and P 500 is down 2% on pessimism that a trade deal will get done. October 10th, you're going to have a meet. That will be Thursday. You're gonna have a meeting between Chinese leaders Xi Jinping and president Trump. So now a little bit of optimism. If you get a trade deal, even a partial trade deal that would send stocks higher, that would send treasury yields higher. You look at the way the market's behaving, a trade deal would be positive for stock prices and bond yields.

The last few weeks have sported a heavy dose of back-and-forth on trade relations between the U.S. and China. 

Wednesday, stocks are moving higher on a positive trade-related development. Here's a recap from the last few weeks and where the two largest economies in the world stand now:

Several weeks ago, as the S&P 500 had touched a 21% 2019 gain on trade-talk optimism, President Trump said he doesn't "need" a trade deal with China before the 2020 election. 

Earlier this week, China said it is no longer considering a broad-based trade deal with the U.S.

China hasn't necessarily shifted from that position, but did strike a more positive tons on trade Wednesday.

Wednesday, Bloomberg reported that China is willing to make a partial deal with the White House. Until Wednesday, stocks had been down for several reasons, all of which are related to whether or not a deal gets done. The S&P 500 is down 1.99% in the past month. But they're getting a lift Wednesday on the positive trade news, with the S&P 500 up a touch under 1% on the day. All three major U.S. indices were up as well. 

Still, there's a condition China is demanding if there is to be any sort of deal: the White House may not impose any additional tariffs to the ones currently in effect. In mid-October and December tariffs on Chinese goods coming into the U.S. are set to go into effect. These tariffs would include industrial goods, some consumer retail finished products and materials, and some consumer electronics like smartphones. China says if there is to be an agreement, those tariffs must not go into effect. 

A partial trade deal -- even if not broad and full -- would likely be a huge boost to both stocks and bond yields. The market has clearly tabbed tariffs and trade relations as the biggest risk factor and a risk-on move when see capital flow into stocks and out of treasuries. As investors have moved into safety, the 10-year treasury has fallen to 1.55% presently from 1.745% a month ago. The yield is up a tad Wednesday. 

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