- Chipmakers rallied Monday after the US and China reached a 90-day trade truce over the weekend.
- Trump agreed to postpone new tariffs on Chinese imports and Xi said China would purchase "a not yet agreed upon, but very substantial" amount of US goods and label Fentanyl a controlled substance.
- If an agreement isn’t reached by 90 days, the current 10% tariffs on $200 billion Chinese imports will jump to 25%, the White House said.
- The meeting offered hope for a resolution of trade disputes, especially for the semiconductor industry that relies heavily on the manufacturing steps in multiple geographic regions, an analyst said.
Chipmakers are rallying Monday as investors welcome the tentative truce on the trade war between the US and China.
In a meeting at the G20 summit in Buenos Aires, Argentina, on Saturday, President Donald Trump agreed to postpone new tariffs on Chinese imports by three months and Chinese President Xi Jinping said China would purchase "a not yet agreed upon, but very substantial" amount of US agriculture, energy, and industrial products, according to a White House statement.
Negotiations have a 90-day window to discuss details on non-tariff barriers such as intellectual property protection, cyber threat, and forced technology transfer. If an agreement isn't reached by the end of the period, current 10% tariffs on $200 billion Chinese imports will jump to 25%, the White House said.
"President Xi also stated that he is open to approving the previously unapproved Qualcomm-NXP deal should it again be presented to him," the White House added.
While the meeting didn't mean the trade war has come to an end, the agreement offered hope for a resolution of trade disputes, especially for the semiconductor industry that relies heavily on the manufacturing steps in multiple geographic regions, according to William Stein, an analyst at SunTrust Robinson Humphrey.
"This Statement is not a formal agreement, but the tone and direction seems very constructive for semis," said Stein in a note out on Monday.