Investors betting on Trump’s tariff concessions as a threat to retaliation

• China rose while Europe and the US were sliding Just as investors were staked, or at least hoped, that US President Donald Trump would set back from his latest aggressive tariff threat. S&P futures were 0.4% off, while Hong Kong rose 1.5%.

Is trade tension rising? Unable to answer that question, investors slid over markets in Europe and the US on Tuesday morning, knocking China.

US President Donald Trump’s recent Double steel and aluminum tariffs His claim that Beijing “completely violated” the conditions of the US-China tariff ceasefire, along with the imposition of 50% and new restrictions on the sale of chip design software to China, has hardly encouraged investors.

and the EU threat of retaliation against metal tariffs; A warning wrapped in a veil of China It is to “continue to take decisive and powerful measures to protect their legitimate rights and interests.”

Still, it appears that Trump’s tariff threat isn’t as bad as they first appeared, and investors’ sentiment that his administration will retreat the toughest (aka “taco” deal) appears to be easing the market from further drops.

“Reports in Washington suggest that the US president may speak directly with President XI of China later this week (after intensifying trade between the US and China for several days).” “Trump is worried about the call and China has not done so, so this may suggest a US withdrawal over trade taxes as a concession to bring China over the phone.”

European markets and US futures fell slightly on Tuesday, with the STOXX Euro 600 down 0.2%, while S&P futures fell 0.4% before the opening bell. In Asia, China’s markets rose: Shanghai rose 0.4% after Monday’s holiday, while Hong Kong’s Hangsen rose 1.5%.

“It’s a difficult time to predict for now given the merciless crossfire of trade headlines. But we are now on a disrupted but sustained path to detachment,” writes global head of macro research Jim Reid, Deutsche Bank. “Even if the US administration remains Hawkish in trade, we have already seen limitations on its approach, particularly in the face of market turmoil and lower approval rates for President Trump.

Here is a snapshot of today’s action before New York’s opening bell (6:15am ET):

•S&P 500On Monday there was a 0.4% increase. The index is 0.9%Ytd.
•S&P futuresIt fell 0.5% this morning.
•Stoxx Europe 600Early trading saw a 0.2% decrease.
•Asia mixed:JapanIt was 0.1% off.Hong KongA rise of 1.5%.ShanghaiIncreased by 0.4%Indian Nifty 50It was 0.7% off.
•BitcoinI sat for $105,300 this morning.

This story was originally introduced Fortune.com