Have you ever booked a table at the restaurant everyone raves about, sat down, eaten a perfectly good meal, and walked out feeling faintly let down? Nothing was wrong. It just was not the evening you had already enjoyed in your head for a fortnight. That, more or less, is what happened to markets this week when President Xi Jinping flew into Washington to meet President Trump.
What actually happened
Xi arrived at Joint Base Andrews this week, and the leaders held talks on Thursday 24 September. Before they had even sat down together, Treasury Secretary Scott Bessent confirmed the headline outcome in a television interview: the trade truce between the two countries, first agreed in Busan, South Korea, last October for one year, has been extended by two more months, to 10 January 2027.
That part got done. The list of what did not get done is longer. There was no fresh cut to tariffs, no firm guarantee on rare earth supplies, no change to the export controls on advanced AI chips, and no movement on Taiwan or Iran. On farm goods, Bessent said China had been buying soybeans well this year but was running behind on some of its other agricultural promises. Analysts quoted by Reuters had warned that the likeliest result was both sides recommitting to old purchase targets rather than signing anything new, and that is roughly where things landed.
Why prices fell on a good outcome
Here is the curious bit. Nobody walked out. Nobody raised tariffs. By any sensible measure, this was a calm, cordial meeting between the two largest economies on earth. And yet, as Saxo’s market strategists noted, Chinese and Hong Kong shares had risen earlier in the week on hopes of a truce, then slipped on Thursday as hopes of something bigger cooled. Saxo summed up the affair as stability, not a breakthrough, which is a phrase I would happily have embroidered on a cushion.
Markets do not trade on events. They trade on the gap between what happens and what people expected to happen. By the time Xi landed, a friendly handshake and a truce extension were already baked into prices. The only thing left to move the needle was a surprise, and the surprise never came. Traders have a tired old line for this: buy the rumour, sell the news, and it is tired precisely because it keeps being true.
How I read it
I will admit my impatience wanted a result. I like a clean ending. But the most useful thing about this summit is the date it created. The truce now runs to 10 January, which means the real negotiation on tariffs, rare earths and chips has been moved into the new year. As the team at investingLive put it, the immediate risk of another tariff escalation has been pushed further out, but the biggest questions are still sitting on the table.
So I have not rearranged a single thing I hold because of this week. What I have done is write 10 January in my diary, because that is the next moment when expectations and reality will have to meet again. If the pattern holds, prices will drift on hope in the weeks before, and the reaction on the day will depend less on what is agreed and more on how much was already assumed.
The lesson I keep relearning
This is exactly why I stopped trying to be clever around headline events and leaned into the approach I wrote about in The Boring Basket That Beat My Best Idea. A spread of holdings doesn’t need me to guess correctly whether two presidents will be in a good mood on a Thursday. It just needs time.
Summits are theatre with consequences. The consequences arrive slowly; the theatre arrives all at once. When I remember to watch the slow part, I make better decisions, and I sleep considerably better too.
The Jacqueline Brand — knowledge builds confidence, and confidence builds wealth. This is editorial commentary for information and education only. It is not financial, investment or professional advice, and nothing here is a recommendation to buy or sell any investment. The Jacqueline Brand is not authorised or regulated by the Financial Conduct Authority. The value of investments can fall as well as rise, and past performance is not a guide to future returns. Figures were correct at the time of publication. Always do your own research and consider speaking to a regulated adviser. Where cryptoassets are discussed, they are high risk and largely unregulated in the UK, and you could lose all the money you invest. The Collection
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