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Illustration: Sarah Grillo/Axios

Wall Street was bursting at the seams with excitement about a trade deal between the U.S. and China — until details of the deal were revealed.

The big picture: China agreed to more than double its annual purchases of U.S. agriculture, up to $50 billion and made yet-to-be-determined concessions on intellectual property rights while the U.S. agreed not to implement its planned Oct. 15 tariffs of 30% on Chinese imports.

What happened: The S&P 500 was flirting with a 2% rise for the day, and then details of the agreement started leaking out and the market's gains leaked with them.

Between the lines: The S&P closed 1.1% higher, and the reversal looked like a typical bout of "buy the rumor, sell the news," but comments about the deal from top strategists and money managers suggest many view the agreement as too little, too late.

What they're saying: A flood of investment strategists and fund managers added their 2 cents. Goldman Sachs' analysts see a 60% chance more tariffs are put in place by the end of the year and expect the drag on manufacturing to continue.

  • "The manufacturing industry has slowed to the point of stagnation," Goldman analysts said in a note. "While it accounts for a modest share of the economy, many investors worry that negative spillovers to the service sector and consumer confidence will drag down the healthy parts of the economy too."
  • “There is not yet a viable path to existing tariffs declining, and tariff escalation remains a meaningful risk,” Morgan Stanley analysts said in a note to clients. “Thus, we do not yet expect a meaningful rebound in corporate behavior that would drive global growth expectations higher.”
  • “The market has basically been held hostage by the trade negotiations,” Bryn Mawr Trust CIO Jeffrey Mills said on CNBC Friday. “I don’t know that we’re out of the woods yet with China. We still have trade negotiations going on with the EU [and] the ratification of NAFTA 2.0.”
  • “Investors had high hopes for some form of mini-deal in the weeks before the meeting, and Friday’s announcement has at least been partially, if not fully, priced in,” JPMorgan equity analysts said in a note, adding that the deal is unlikely to have a material effect on the already slowing U.S. manufacturing and services sectors.
  • “Trump’s statement that ‘We are near the end of the trade war’ is not plausible to us,” analysts at Evercore wrote in a note. “We do not expect tariff cuts in 2020 – but are ready to be favorably surprised."
  • “I don’t think this gets us to Christmas,” UBS' NYSE floor director Art Cashin told CNBC. “I think it could be a temporary truce that wouldn’t last very long.”

Go deeper: Trump says U.S. and China reach partial trade agreement

Go deeper

Updated 8 mins ago - World

Over 70 dead in worst bombardments between Israel and Hamas for years

Smoke and flames rise after Israeli fighter jets conducted airstrikes in Gaza on May 13, 2021. Israeli forces said on May 12 they had killed a senior Hamas commander and bombed several buildings. Gaza's health ministry has said children are among the dead. Photo: Ashraf Amra/Anadolu Agency via Getty Images

At least 67 Palestinians and seven Israelis have been killed in fighting between Israel's military and Hamas since Monday, per Reuters.

The big picture: The worst aerial exchanges of fire between Israel and Hamas since 2014 come days after escalating violence in Jerusalem that injured hundreds of Palestinians and several Israeli police officers during protests over the planned evictions of Palestinian families from their homes.

43 mins ago - Health

COVID-19 pandemic was "preventable disaster," WHO-commissioned report says

A health worker gives a COVID-19 test to a woman in Oakland, California. Photo: Jane Tyska/Bay Area News Group

The COVID-19 pandemic was a "preventable disaster" that exposed weak links "at every point" of the preparedness process, according to a World Health Organization-commissioned report published Wednesday.

Why it matters: The report by the Independent Panel for Pandemic Preparedness and Response criticized governments worldwide for being unprepared for the pandemic despite the prevalence of past "global health threats," such as Ebola, Zika, and SARS outbreaks.

Don McGahn agrees to House panel interview on Russia report

Former White House counsel Don McGahn during a discussion at the NYU Global Academic Center in Washington, D.C., in 2019. Photo by Alex Wong/Getty Images

Former White House counsel Don McGahn agreed Wednesday to speak with the House Judiciary Committee about the Russia investigation that led to the impeachment trial of former President Trump — with certain conditions, per a court filing.

Why it matters: The agreement ends a two-year standoff after McGahn, a key player in former special counsel Robert Mueller's investigation, repeatedly refused to agree to a subpoena for testimony — resulting in the matter being taken to court.

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