By Spencer Feingold

The markets made a major comeback Monday afternoon after China confirmed that its trade delegation will travel to Washington D.C. this week for continued negotiations.

Global stocks plummeted earlier in the day after President Trump upended what appeared to be significant progress in recent weeks between the U.S. and China to reach a trade deal. The Dow Industrial — which was down over 450 points in early trading — pared losses to close down just 66 points.

Trump tweeted on Sunday that negotiations were moving “too slow” and that he was prepared to hike current tariffs if a deal wasn't reached soon. Those new tariffs ー 25 percent from 10 percent on $200 billion worth of Chinese goods ー are scheduled to trigger on Friday if a deal isn't reached in time. On Monday morning, Trump also tweeted the U.S. is losing between $600 billion and $800 billion a year on trade with China, and "we're not going to be doing that anymore" ー according to the U.S. Census, the trade deficit was actually $419 million in 2018.

The tweets were also paired with reports that the Chinese may skip this week’s final round of negotiations, spooking Wall Street and sending the markets into a free fall.

“What I can say is that the Chinese delegation is preparing to travel to the U.S. for consultations,” Geng Shuang, a Chinese foreign ministry spokesman, said at the ministry’s daily press briefing in Beijing on Monday.

Analysts noted that China is inclined to keep negotiations on track and are eager to avoid the financial whiplash that markets experienced Monday.

“China has a lot more to lose on this,” Ray Wang, the principal analyst and founder of the financial firm Constellation Research, told Cheddar. “This requires a little bit delicate approach to be able to get this win-win deal, or a perception of a win-win deal.”

Wang added that this type of negotiation — with threats of tariffs via Twitter — are “probably not necessarily the way they are used to interacting. This doesn't fit any play book they have ever experienced.”

“That win-lose approach may backfire,” he said.

Trade with China has been a major issue for President Trump since taking office and a deal seemed to be on the horizon this week, despite several sticking points such as protection for intellectual property rights and adherence to World Trade Organization regulations.

“We’re getting into the final laps,” Treasury Secretary Steven Mnuchin said last week.

Wang noted, however, that the negotiations remain particularly tricky for both countries.

“There is a trust and verify component that is being asked of China to do this, and to codify that into their legal ruling,” Wang said, noting that the U.S. has little legal enforcement mechanisms other than sanctions and tariffs.

Wang added that as the 2020 presidential election gets closer, the Chinese will also have great leverage over a U.S. administration eager for a political win.

For full interview click here.