Bessent's China Breakthrough Boosts Stocks Ahead of Trump-Xi Summit
The US Treasury Secretary, Scott Bessent, met with China's Vice Premier He Lifeng in New York on Monday, resulting in a 'very successful' session that lifted stocks. The meeting aimed to establish a bilateral working group on AI risks, which could influence how US export controls on advanced chips are applied.
The relief provided by Bessent's comment was exactly what the market needed after a week of hawkish projections and triple witching volume. The Federal Reserve raised interest rates for the first time since 2023, citing persistent inflation and elevated oil prices. Fed Chair Kevin Warsh named Brent crude trading above $104 as a key driver of inflation.
The S&P 500 finished the week at 7,551.81, while the 10-year Treasury yield hit 5 percent for the first time since November 2023. This change in borrowing costs will impact the economy, affecting thirty-year mortgages and corporate treasurers' capital expenditure plans.