Global markets are enjoying some gains this week on hopes that Beijing and Washington will reach a trade agreement, but strategists at J.P. Morgan Asset Management are skeptical on whether anything significant will be resolved.
Chinese and the U.S. officials concluded another round of trade talks Wednesday, which were extended into a third day — suggesting there has been some compromise. The Chinese Foreign Ministry said that details of the talks will be released "soon."
"I think (the deal) would have to be extremely far-reaching for the markets to breath an enormous sigh of relief," Karen Ward, chief market strategist at J.P. Morgan Asset Management, told CNBC Wednesday.
"I don't think, unfortunately, that (the trade war) is something that will disappear from our horizon for the full year," she added.
President Donald Trump campaigned in 2016 on cracking down on what he called Chinese trade abuses, and both countries have been at odds for about a year. The U.S. has put tariffs on $250 billion in Chinese goods — and has threatened more, while Beijing has responded with tariffs on $110 billion in U.S. goods.
Ward added that the deal "would have to be extraordinarily complete" and "it would also have to be clear that (Trump) is not diverting attention just away from China but towards Europe and the autos" to calm down the financial markets.