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Reproduced from Panjiva; Chart: Axios Visuals

U.S. stocks fell sharply in the final hour of trading Wednesday after President Trump seemingly reignited the trade war, telling reporters the U.S. would be evaluating whether China has complied with the "phase 1" trade deal to buy an extra $200 billion a year of U.S. goods.

Why it matters: As the coronavirus pandemic continues to choke the U.S. and global economy, Trump is threatening to tighten the vice.

By the numbers: S&P Global Market Intelligence, Panjiva, finds that not only is China not making purchases on pace for a $200 billion increase, it is now $21.2 billion behind — not even halfway to its target on a monthly basis.

  • Further, data Thursday showed Chinese exports rose 3.5% year over year in April while imports fell 14.2%, bringing China’s trade surplus for the month to $45.34 billion — well above the $6.35 billion economists had predicted.

What's happening: Most had long expected that China would be unable to meet the terms of the deal as the novel coronavirus ravaged its economy, causing the worst quarterly economic contraction on record.

  • But it was expected the U.S. would look the other way, given the economic situation.

What we're hearing: "Trump is basically trying to distract the American public from focusing too much on the unemployment rate, employment figures and so on," Keith Wade, chief economist at Schroders, said during a recent webcast.

  • "If we do reignite the trade wars, and we see the ‘phase 1’ deal fail, I think it won’t just be China that loses, it will be the U.S. as well."

Between the lines: The nascent stock market rebound also could be threatened by revived tensions between the world's two largest economies.

  • “That’s probably the number one concern in the market when we talk to investors and sell-side analysts,” Zhiwei Zhang, president and chief economist of Pinpoint Asset Management, told CNBC Wednesday.

Watch this space: The general public is starting to grow more wary of the tariffs. A new survey from CivicScience finds a record high 71% of Americans are concerned, and industry lobbying groups have ramped up messaging again opposing the trade war.

  • “Adding more tariffs during a time of economic crisis will only further punish U.S. companies, manufacturers, and farmers who are already struggling to survive," Americans for Free Trade spokesperson Jonathan Gold said in a statement earlier this week.

Go deeper

Dion Rabouin, author of Markets
Aug 13, 2020 - Economy & Business

S&P 500's historic rebound leaves investors divided on future

Data: Money.net; Chart: Axios Visuals

The S&P 500 nearly closed at an all-time high on Wednesday and remains poised to go from peak to trough to peak in less than half a year.

By the numbers: Since hitting its low on March 23, the S&P has risen about 50%, with more than 40 of its members doubling, according to Bloomberg. The $12 trillion dollars of share value that vanished in late March has almost completely returned.

Dion Rabouin, author of Markets
Updated 2 hours ago - Economy & Business

Our make-believe economy is here to stay

Illustration: Eniola Odetunde/Axios

The Federal Reserve and global central banks are remaking the world's economy in an effort to save it, but have created something of a monster.

Why it matters: The Fed-driven economy relies on the creation of trillions of dollars — literally out of thin air — that are used to purchase bonds and push money into a pandemic-ravaged economy that has long been dependent on free cash and is only growing more addicted.

Mike Allen, author of AM
3 hours ago - Politics & Policy

Why Trump may still fire Barr

Photo: Jabin Botsford/The Washington Post via Getty Images

Attorney General Barr may be fired or resign, as President Trump seethes about Barr's statement this week that no widespread voter fraud has been found.

Behind the scenes: A source familiar with the president's thinking tells Axios that Trump remains frustrated with what he sees as the lack of a vigorous investigation into his election conspiracy theories.