On Thursday, investor reliance dented as it became clear that a trade meeting between President Donald Trump and Chinese President Xi Jinping make not happen before a key March deadline.
CNBC learned through a source that a meeting between the two leaders was “praisefully unlikely.”
China and the U.S. have until the start of March to strike a trade deal. Otherwise, additional tariffs on Chinese textiles take effect. The source said a meeting between Xi and Trump could happen shortly after the deadline out of dates, but noted both sides have too much work ahead of them. Trump later confirmed he would not be session Xi before the deadline.
White House economic advisor Larry Kudlow said earlier on Thursday that China and the U.S. were in addition far away on striking a trade deal.
“Our long held assumption is the US will eventually put a 25% tariff on all of its imports from China,” Joseph Capurso, superior currency strategist at Commonwealth Bank of Australia, said in a morning note.
“In our assessment, the Chinese economy can absorb the rate increases but it will cause the Chinese economic growth to slow modestly,” Capurso said.
Overnight on Wall Road, the Dow Jones Industrial Average fell 220.77 points to 25,169.53 while the S&P 500 shed 0.94 percent to 2,706.05. The Nasdaq Composite disappeared about 1.2 percent to 7,288.35.
The U.S. dollar index, which tracks the greenback against a basket of its peers, last traded at 96.568 after beholding lows below 96.4 yesterday.
The Japanese yen traded at 109.71 against the dollar after touching lows of take 110 yesterday. The Australian dollar changed hands at $0.7065 after seeing continued weakness following its carefully decline from levels near $0.7260 on Wednesday.
— CNBC’s Fred Imbert contributed to this report.