Trade between the United States and China, currencies in the foreground

Investors will closely monitor developments on the trade front between the United States and China, a new round of talks to be held in Beijing later this week.

"The reality is that the olive branches, rather than the stems of roses, are the best that anyone (grounded in reality) can look for," Mizuho said in a morning note.

He pointed out that "restrictions" dominated these discussions.

"First of all, at the end of last week, President Trump had declared that he would not meet with President Xi before the deadline (March 1st) for the American-Chinese trade truce ", says the note.

"However, Trump also categorically stated that there will be no trade agreement between the two countries before President Xi and himself met. therefore also a guarantee to guarantee that there will be no agreement before the expiry of the American-Chinese truce. " This, says the note, not only "contradicts" Trump's previous tweets enthusiastic about an ongoing agreement, but "raises the question" of whether this meant an increase in tariffs on Chinese imports.

The Wall Street Journal reported last Friday that the two countries have not yet developed a draft on the points on which they agreed or disagreed. The report comes as Washington and Beijing attempt to reach a trade deal by early March, after which additional tariffs will be applied to Chinese imports into the United States.

It is also following US President Donald Trump, who said Thursday that he would not meet with Chinese President Xi Jinping before this deadline. White House economic adviser Larry Kudlow also said it was "a long enough distance to go" before China and the United States reached an agreement.