US. Stock futures recovered from heavy early losses during trading day overnight Wednesday and gathered following a report that indicated potential progress in the US and China trade wars.
Bloomberg News reported Wednesday night that the White House could conduct a previously agreed currency trade with China ahead of schedule and cancel tariff increases scheduled to take effect next week. These moves would be part of a first phase agreement with China, Bloomberg said, with negotiations on critical issues such as intellectual property and the forced transfer of technology coming later in phase two.
Separately, the New York Times reported Wednesday night that President Donald Trump had green-lighted licenses to certain US companies to do business with Chinese telecom giant Huawei Technologies. The US blacklisted Huawei earlier this year and allowing the sale of non-sensitive products could help relieve trade tensions.
The news comes before the first face-to-face, high US-China trade negotiations since July. China's Deputy Prime Minister Liu Han will meet with Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin on Thursday in Washington.
The reports were welcome news for futures traders who had reacted to bad news just hours before.
U.S. stock futures had fallen when trading opened following a report that lower-level trade talks between the US and China had made "no progress" in resolving the annual trade war.
The Hong Kong-based English-language newspaper South China Morning Post reported late Wednesday that talks this week to lay the groundwork for high-level negotiations had made no progress on critical issues, and that the main negotiating session had been postponed from two days to just one day, with the Chinese delegation now scheduled to leave Washington after their closure Thursday. China reportedly refused to consider changes in technology forcible transfers, one of America's foremost problems
immediately fell almost 300 points, or 1%. S&P 500 futures
and Nasdaq Composite futures
was also more than 1% at one point. But these losses were erased according to reports from Bloomberg and Times. From 10:40 p.m. Eastern, all three forward contracts were back to about zero.