U.S. President Donald Trump and Indian Prime Minister Narendra Modi meet in the Oval Office at the White House on February 13, 2025 in Washington, DC.
Andrew Harnik | Getty Images News | Getty Images
All eyes are on U.K. Prime Minister Keir Starmer as he begins a high-stakes, three-day trip to China, the first by a British prime minister since 2018.
Starmer is set to meet Chinese President Xi Jinping and Premier Li Qiang on Thursday, accompanied by nearly 60 British businesses and cultural organizations, according to an official U.K. readout. The agenda spans trade, investment and national security, underscoring the breadth and sensitivity of the talks.
Among those traveling are executives from HSBC Group, Aberdeen Group, aircraft giant Airbus, British Airways, AstraZeneca and GSK, signaling a concerted push to deepen commercial ties even as geopolitical tensions linger.
The visit comes just one day after India and the European Union announced a “landmark” free trade deal, part of a broader surge in bilateral trade agreements, as countries recalibrate supply chains and commercial ties in response to Washington’s increasingly muscular use of tariffs.
Just this month, Canadian Prime Minister Mark Carney visited China, the first by a leader in his position in 17 years, in a bid to expand economic partnerships with the world’s second-largest economy.
Yet the India-EU pact, memorably dubbed the “mother of all deals” by European Commission President Ursula von der Leyen, has yet to clear its most unpredictable hurdle: U.S. President Donald Trump.
Trump, who has slapped punitive tariffs on friends and foes alike, has yet to weigh in on the India-EU agreement. His silence is notable.
In August last year, the U.S. imposed higher levies on Indian goods over India’s oil purchases from Russia, days after imposing a 25% duty on New Delhi.
With Trump’s recent escalating rhetoric toward the EU, including threats tied to Greenland, his response looms as a persistent cloud over the “historic” deal. And that cloud darkened further when U.S. Treasury Secretary Scott Bessent criticized the EU for forging a trade agreement with India in an interview with ABC News on Sunday.
But perhaps it’s not all doom and gloom, as the U.S. and India are at “a very advanced stage” of finalizing a highly-anticipated deal, India’s Minister of Petroleum and Natural Gas Hardeep Singh Puri told CNBC Tuesday.
Another cloud weighing on investors’ minds is the U.S. Federal Reserve, which concludes its policy meeting Wednesday. Rates are widely expected to remain unchanged, but Chair Jerome Powell’s remarks will be closely parsed amid renewed political pressure on the central bank.
What you need to know today
British businesses to join Starmer’s China visit. Nearly 60 British businesses and cultural organizations will join the U.K. prime minister in Beijing on Thursday, in the first such state visit in eight years. Trade, investment and national security will be on the meeting agenda, according to an official U.K. readout.
S&P 500 closes at a record. On Tuesday stateside, the benchmark rose to a new all-time intraday high on gains in Big Tech, ahead of key earnings from companies in the sector. The Nasdaq Composite also climbed, but the Dow Jones Industrial Average fell. Asia markets traded mixed, while South Korean indexes continued notching record highs.
A partial U.S. government shutdown. That looks possible beginning early Saturday, largely due to strong Senate Democratic opposition to funding for the Department of Homeland Security and other agencies, after the second recent killing of a U.S. citizen by federal agents in Minneapolis.
Amazon accidentally sends email confirming cloud unit layoffs. The e-commerce giant on Tuesday sent the notice in an apparent error, acknowledging “organizational changes” at the company. Amazon is expected to announce widespread layoffs across its corporate workforce as soon as this week, a person familiar with the matter previously told CNBC.
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And finally…
Chinese companies are accelerating the rollout of new artificial intelligence models as competition with U.S.-based rivals OpenAI, Anthropic and Google intensifies.
On Tuesday, Beijing-based startup Moonshot AI revealed Kimi K2.5, which claimed to have video-generation and agentic capabilities that outperformed all three of the leading U.S. AI models. Agentic AI broadly refers to AI systems capable of carrying out tasks on behalf of people. The ultimate goal is to have sophisticated agents that work autonomously with minimal user interaction.
The update came just about three months after Moonshot released its K2 model.
— Evelyn Cheng
