China's top diplomat says Trump-Xi Argentina summit 'friendly and candid'

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That's why carmakers and auto parts manufacturers on both sides of the Pacific were initially buoyed by the claim of an "incredible" trade deal emerging from the 2-1/2 hour dinner meeting President Donald Trump held with his Chinese counterpart Xi Jinping on Sunday at the G-20 summit.

Ahead of the statement from China, President Trump sounded optimistic, but reiterated his tough stance.

"On Trade, President Trump has agreed that on January 1, 2019, he will leave the tariffs on $200 billion worth of product at the 10% rate, and not raise it to 25% at this time". And then on Wednesday morning, Trump tweeted that he believed Xi "meant every word of what he said at our long and hopefully historic meeting".

USA markets were closed on Wednesday to observe former President George H.W. Bush's death, but the effect of Wall Street's turmoil the previous day was felt in Europe and Asia with the benchmark Shanghai stock index .SSEC closing down 0.6 percent.

The Dow had spiked up almost 300 points on Monday, encouraged by Trump's weekend announcement that he and Xi had forged a trade truce.

The two leaders, who met on the sidelines of a Group of 20 summit in Argentina, also chose to hold off on new tariffs and give negotiators three months to strike an agreement.

As White House officials fanned out to talk up what U.S. President Donald Trump called "an incredible deal" with China to hit pause in their trade war, Beijing has said little on a pact that cheered markets but left many questions unanswered. As part of his Twitter storm today, the U.S. president called himself "Tariff Man" and then proceeded to demonstrate his lack of basic understanding about how tariffs work, seemingly ignorant of the fact that tariffs are in effect a tax paid by domestic consumers, not foreign countries. "But if not remember".

A day later, President Trump said on his Twitter that "the negotiations with China have already started" and that the deal will probably happen.

"In the next 90 days, we will work in accordance with the clear timetable and road map to negotiate in areas where both sides have an interest and there are mutual benefits, such as intellectual property rights protection, technology cooperation, market access and the trade balance".

White House officials have also struggled to explain whether China had actually agreed to drop a 40 per cent tariff on U.S. cars as part of the deal.

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Trump applauded China's remarks on Wednesday in a tweet.

A Chinese official told Reuters that officials were "waiting for the leaders to return" before publicizing details.

The economic stimulus from USA tax cuts is beginning to fade.

Trump "shared his vision of all automakers producing in the United States and creating a more friendly business environment", the White House said in a statement afterward.

"China's discussed these things with the U.S. many times down through the years and the results have not been very good", he said.

And China doesn't pay the tariffs - large importers like automakers or big box retailers do, either taking a loss or passing them on to consumers in the form of higher prices.

And in the United States, home sales have fallen sharply in the past year as mortgage rates have jumped.

Trump, via Twitter, threatened to place "major tariffs" on Chinese goods imported into the United States if his administration is unable to reach an effective trade deal with Beijing.

The US expects China to take immediate action to cut tariffs on US auto imports and end intellectual property theft and forced technology transfers as the two countries move toward a broader trade deal, Kudlow, director of the White House National Economic Council, said Monday.

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