• by Thom Forbes  @tforbes, December 13, 2019

Stocks soared in global markets this morning on reports that the United States and China have reached an agreement on a “phase one” trade deal that will forestall the new tariffs on Chinese goods set to take effect Sunday, roll back the existing rates on other products and open the world’s third-largest market to an array of agricultural and other products.

"Stocks climbed Thursday after President Donald Trump first said on Twitter that the U.S. and China were nearing a ‘big deal’ that could avoid fresh tariffs, planned to go in effect Dec. 15, and potentially roll back some existing duties. The Wall Street Journal later reported a limited trade deal had been agreed, citing sources,” Barbara Kollmeyer writes for  Market Watch.

Coupled with Boris Johnson’s decisive win in the British elections, which clears the way for a Brexit deal, the Dow Jones Industrial Average futures continued to climb this morning and the MSCI index of developed and emerging world equity markets reached an all-time high, Theron Mohamed reports  for Markets Insider.

“‘Some investors will see today as Christmas come early, as we see a convergence of two critical political risks coming to some resolve,’ one economist said,” Mohamed writes.

“Michael Pillsbury, an adviser to the president, said he spoke with Mr. Trump, who said the deal calls for China to buy $50 billion worth of agricultural goods in 2020, along with energy and other goods. In exchange the U.S. would reduce the tariff rate on many Chinese imports, which now ranges from 15% to 25%,” Lingling Wei, Bob Davis, William Mauldin and Josh Zumbrun write for The Wall Street Journal.

“The Wall Street Journal reported earlier Thursday that the U.S. side has offered to slash existing tariff rates by half on roughly $360 billion in Chinese-made goods, in addition to canceling the tariffs on $156 billion in goods that Mr. Trump had threatened to impose on Sunday. That offer was made to Beijing in the past five days or so.

“Should Beijing fail to make the purchases it has agreed to, original tariff rates would be reimposed. Trade experts call that a ‘snapback' provision, though the president didn’t use that term, Mr. Pillsbury said,” the WSJ reporters add.

“It’s a breakthrough,” Pillsbury, who is a China expert at the Hudson Institute, tells The Washington Post’s David J. Lynch. “He says it’s historic. I certainly agree with that.”

Also historic -- and competing for news consumers’ attention -- will be the House Judiciary Committee’ final vote on articles of impeachment of the President, which late last night was controversially postponed until 10 a.m. this morning by chairman Jerry Nadler (D-NY).

It should be noted that no formal announcement on the agreement had been made by 7 a.m. ET.

“China’s Commerce Ministry, which usually releases news about the trade talks, was notably silent on Friday morning Beijing time. Its media office did not respond to calls and faxes requesting comment,” WaPo’s Lynch points out.

“An announcement is expected Friday Washington time, according to people familiar with the plans,” write  Bloomberg’s Jenny Leonard, Jennifer Jacobs, Shawn Donnan and Saleha Mohsin in confirming the agreement.

“The administration has reached out to allies on Capitol Hill and in the business community to issue statements of support once the announcement is made, people said. Before meeting his trade advisers, Trump engaged with members of the Business Roundtable, which represents some of the largest U.S. companies, they said,” they continue.

“Trump changed his mind on deals with China before,” they also point out.

It should also be noted, as WaPo columnist Catherine Rampell did  about a year ago, that “for his entire career, our dealmaker in chief has relied on a not-so-secret technique for extracting supposedly good deals: He agrees to a given set of terms and then, at the last minute, reneges on them.”