Trump-Xi Summit: A New Chapter in World Trade or Just Theater?

One of the most interesting news items ahead of the meeting is the proposal for a new "Board of Trade". Its purpose would be to manage trade between the countries within a regulated framework. With key parts of the October 2025 trade war truce set to expire in November 2026, a new, more permanent solution is believed to be at the heart of the meeting.

What makes this visit unusual is the delegation accompanying Trump. Rumor has it that the CEOs of major companies such as Apple, Nvidia, Boeing and Exxon have been invited. Relations with China are vital for Apple and Nvidia in particular. Investors will be watching to see if the meeting will result in relaxation of restrictions on chip exports or guarantees of supply chain stability. The security of artificial intelligence and common standards could also become an important topic. This could reassure markets concerned about  the risks of uncontrolled "AI weaponization".

The timing of the meeting is interesting, as both Alibaba and Tencent are scheduled to announce their Q1 results, just before the summit, on Wednesday, May 13..

The Hang Seng Index recently broke the 26,000-point mark, which may signal growing investor confidence in the recovery of Chinese technology stocks.

Additionally, Alibaba's AI-driven growth in cloud services in particular is expected to be under scrutinized. If the results arepositive when Trump and Xi shake hands in front of the cameras, China stocks could rally  sharp.

Although trade is the main topic, the prospect of war with Iran and the situation in the Strait of Hormuz also loom over the discussions. Trump arrived in Beijing at a time when the energy shock caused by the Iran conflict has shaken global markets.

China is Iran's largest oil buyer, and Trump hopes to persuade Xi to pressure Tehran into making peace. If investors receive even a slight indication that the two countries are working together to open oil routes, energy prices could decrease, thereby alleviatingglobal inflationary pressures.

The direction of the stock markets could be significantly impacted this week. If Trump returns home with substantial purchase commitments and a promise of a new trade agreement, the market's all-time high (ATH) sentiment could persist. However, if the talks end with accusations of technology theft or disputes over Taiwan, we could see a rapid shift towards safe havens such as gold.

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