It has been a very confusing week for investors as the Trump administration continues to deliver mixed messages on the state of trade relations with China. Friday's moves in the stock market highlight how difficult it has been for Wall Street to navigate through the conflicting headlines.
On Friday morning, National Economic Council Director Larry Kudlow told CNBC's "Squawk on the Street" that President Donald Trump would consider extending the current 90-day truce between the U.S. and China if progress was made in the ongoing talks. China and the U.S. agreed over the weekend to a 90-day cease-fire to their ongoing trade spat.
But Peter Navarro, a trade advisor to Trump, told CNN shortly after Kudlow's interview that the president would "simply raise" tariffs on billions of dollars worth of Chinese goods if no deal is reached during the cease-fire.
Subsequently, the S&P 500 erased the gains that followed Kudlow's comments and dropped more than 2 percent, wiping out its gains for the year.