Will a bump up in China tariffs be a boon for U.S. capital markets over international markets? The U.S. has long been in pole position in terms of the global economy and investors who think this will continue can trade their confirmation bias with the Direxion FTSE Russell US Over International ETF (NYSEArca: RWUI).

China responded to the latest tariff threats by President Trump, promising to take “necessary countermeasures” if the Trump administration follows through on its threat to increase tariffs on Chinese goods.

“The escalation of trade friction is not in the interests of the people of the two countries and the people of the world,” the ministry said. “The Chinese side deeply regrets that if the US tariff measures are implemented, China will have to take necessary countermeasures.”

U.S. Markets Still Thriving in 2019

Despite the latest market volatility as a result of the U.S.-China trade deal impasse, the red, white and blue is still seeing green when it comes to the major indexes’ performance year-to-date–the Dow Jones Industrial Average is up 10.72 percent, the Nasdaq Composite is up 19.22 percent and the S&P 500 is up 14.52 percent.

Furthermore, despite a number of roadblocks heading into 2019 after a rough fourth-quarter market showing to end 2018, the U.S. economy rebounded in the first quarter this year, beating analysts’ expectations of 2.5 percent growth with a 3.2 percent growth number.

The GDP figure represents the strongest rate of growth for the first quarter in four years and matches the 3.2 percent growth experienced a year ago.

Meanwhile, the rest of the world’s slowdown could be RWUI’s gain as global economic growth remains a primary concern. Earlier this year, the IMF cut its global growth forecast to the lowest level since the financial crisis, citing the impact of tariffs and a weak outlook for most developed markets.

According to the IMF, the world economy will grow at a 3.3 percent pace, which is 0.2 percent lower versus the initial forecast in January. Nonetheless, strength in leading markets like the U.S. with its healthy labor market are keeping global growth afloat.

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