Pressure on the United States is also increasing from the corporate sector, as big American manufacturers with exposure to China start taking a financial hit. Caterpillar on Monday said its profit for 2019 would be lower than expected as sales of heavy machinery to China slow and costs for materials rise, in part because of tariffs on foreign steel and aluminum. Nvidia, a big chip maker, cut its fourth-quarter revenue estimates, in part because of weak demand for its gaming chips in China.
“Deteriorating macroeconomic conditions, particularly in China, impacted consumer demand,” Nvidia said in a news release. Shares of both companies fell, dragging down equity markets in the United States.
Markets have been fixated on the status of the talks, with any inkling of optimism sending global stocks higher. Advisers to Mr. Trump, fearful that he could strike a quick deal to give stocks a lift, have cautioned him against focusing too much on daily market swings.
The prospect of an unresolved trade war between the world’s two largest economies has dampened business confidence. A survey released on Monday by the National Association for Business Economics found that 36 percent of manufacturers in the United States have raised prices because of Mr. Trump’s trade policies and 27 percent have delayed investments. Business groups such as the U.S. Chamber of Commerce have urged the administration to take a less confrontational approach to China.
With the deadline quickly approaching, Trump administration officials have been downplaying expectations about a potential deal being reached soon. Wilbur Ross, the Commerce secretary, said last week that the United States and China were “miles and miles” apart and Larry Kudlow, the director of the National Economic Council, suggested that details of a deal were not set in stone ahead of the discussions this week.
Congressional aides who have been briefed by the administration on the status of the talks said China has agreed to make large purchases of American products to reduce the trade deficit, which is one of Mr. Trump’s key goals. China’s commitment to addressing other concerns, such as forced technology transfer, protections for American intellectual property and reducing its subsidies of state-owned-enterprises, remains uncertain.
The Trump administration has also made little progress when it comes to devising a way to ensure that China lives up to whatever commitments it makes in a final agreement. There is widespread concern among trade experts that China could be slow-walking the negotiations and that it will offer repackaged promises that it has failed to deliver on in the past. To prevent that, officials have been considering “snap-back” tariffs that could be quickly s, or “carousel” tariffs that would hit different swaths of Chinese goods if Beijing fails to follow through.