Dow Wobbles as US Senate Hong Kong Bill Pressures Trump-Xi Relations

  • US stocks are under pressure, with the US Senate poised to pass a bill supporting Hong Kong that may destroy Trump’s hopes of a phase one trade deal.
  • The Dow made no progress as a huge sell-off in Cisco undid a decent rally in Boeing stock.
  • Weakening Chinese data suggest Xi needs a trade deal, but analysts are skeptical it is imminent.

The Dow Jones wobbled on Thursday as anticipation of a Chinese crackdown in Hong Kong prompted the US Senate to press ahead with a unanimous bipartisan effort to pass a law in support of the anti-government protestors.

Given the precarious nature of trade talks, this is terrible news for both Donald Trump and the Dow, as it reduces the probability of a trade deal passing anytime soon.

Dow Jones Roiled by US-China Trade Deadlock

The Dow Jones fell on Thursday as Hong Kong continued to damage hopes of a trade deal between the US and China. | Source: Yahoo Finance

All three of the major US indices remained virtually unchanged, as the Dow Jones Industrial Average, Nasdaq, and S&P 500 all bounced between gains and losses.

Shortly before the closing bell, the Dow had dipped 16.81 points or 0.06% to 27,766.78.

The Nasdaq slid 0.06%, but the S&P 500 ticked 0.01% higher to round out a mixed day on Wall Street.

The cautious move from risk assets was confirmed by a decline in Treasury yields, and money flowed into bonds and gold.

Hong Kong Bill Throws Another Wrench into Trade Talks

Investors appear to be growing tired of waiting for a trade agreement, with multiple reports emphasizing deadlock and a partial trade agreement looking more and more elusive.

Even a basic farm goods purchase increase seems impossible to secure, and the probability of a comprehensive agreement is unquestionably dropping.

Nevertheless, the Dow Jones has been resilient to trade war uncertainty, focusing on robust earnings and trusting that Trump is going to secure some kind of deal ahead of the 2020 election.

However, with Senator Marcio Rubio leading a

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