The Trump-Xi summit has reduced the short-term risks of a new trade conflict between the US and China. Investors view the meeting as a signal of continued trade truce, stabilization of supply chains, and a possible easing of restrictions in the tech sector.

The trade truce is no longer a temporary pause

The summit between Donald Trump and Xi Jinping in Beijing was more than just a diplomatic event; it was an attempt to stabilize relations between the world's two largest economies after months of trade pressure, sanctions threats, and the conflict over Iran. Markets expected the meeting to result in either a new round of escalation or at least a temporary cooling of tensions. Ultimately, investors received precisely the latter scenario.

The main outcome of the meeting was confirmation of the continued existence of the trade truce between the US and China. Although the parties did not disclose the full package of agreements, the very fact that a new meeting is scheduled for September demonstrates that Washington and Beijing are interested in maintaining a managed dialogue rather than completely severing economic ties.
This is critical for global markets. Over the past two years, instability in US-China relations has become a key factor in pressure on logistics, semiconductor manufacturing, rare earth metal exports, and the global technology sector.

The White House is now effectively sending a signal to businesses: despite the harsh rhetoric, the US is not prepared for a scenario of all-out economic war with China. Beijing, for its part, is using this period to strengthen its own industrial base and expand its export influence.

Artificial intelligence has become a new arena for global competition

While the conflict previously centered on tariffs and industrial exports, artificial intelligence and access to computing power are now becoming key topics. This is why investors have paid so much attention to reports of possible approval for Nvidia H200 sales to Chinese tech companies.

For China, this is a question not only of business but also of technological sovereignty. US restrictions on the export of advanced AI chips have seriously slowed the development of Chinese AI companies. Against this backdrop, even a partial easing of restrictions is perceived by the market as a potential turning point.
Nvidia CEO Jensen Huang's presence alongside Trump in Beijing was symbolic. This is no longer just a hardware sale, but a battle for control over the AI ​​infrastructure of the next decade.

Particularly significant is the fact that investors have begun to view the Chinese tech sector differently. While many previously doubted whether Chinese companies would be able to monetize their massive investments in AI, the strong performance of American big tech companies has changed the mood. The market is beginning to anticipate a scenario in which Chinese internet giants will replicate the American AI cycle with a delay of several quarters.
This explains the growing interest in shares of Alibaba, Tencent and Chinese semiconductor companies, especially against the backdrop of a general shortage of computing power in Asia.

Geopolitics is again influencing oil and global capital

The summit took place against the backdrop of the ongoing crisis surrounding Iran and the Strait of Hormuz. Therefore, the energy topic proved no less important than trade and technology.
Trump announced that China had agreed to increase purchases of American oil and participate in stabilizing the situation around Iran. Even without official confirmation from Beijing, the signal itself proved significant for commodity markets.

In effect, Washington is attempting to draw China into the Middle East's energy security architecture. For the US, this is a way to reduce the burden on its own foreign policy while simultaneously strengthening economic interdependence with Beijing.
However, China is proceeding cautiously. Beijing remains the largest buyer of Iranian oil and has no interest in damaging relations with Tehran. Therefore, analysts believe China will continue to balance cooperation with the US and maintaining its strategic partnership with Iran.

Investors are closely monitoring this configuration, as it affects not only the price of oil, but also the stability of global supply chains, inflation, and central bank policy.
Today, markets are reacting less and less to grandiose statements and more and more to real signals of stability. And this was the main outcome of the Beijing summit: the US and China demonstrated that they are not yet ready to move towards an open economic breakaway; the cost of such a scenario for the entire global economy could be too high.

By Miles Harrington 
May 15, 2026

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