U.S.-China trade tensions escalated last week. President Trump increased tariffs on $200 billion of Chinese imports to the United States from 10% to 25% and has threatened to put 25% tariffs on an additional $325 billion of Chinese goods — a process that could begin this week, though it would take a couple of months to implement. Stocks reacted as you would expect, falling 2.1% over the five trading sessions. It could’ve been worse, but the S&P 500 Index gained 0.4% on Friday after Treasury Secretary Steven Mnuchin reported that talks on Thursday and Friday were constructive. Though this slide could certainly go further (and is, as of the morning of May 13), it has been quite modest to this point. In fact, as of its close May 10, the S&P 500 had not experienced more than a 3% pullback yet this year. Even with Monday morning’s losses, the index sits only about 4% from its record closing high of 2945.83 on April 30, 2019. Here, we put this pullback in perspective and discuss prospects for a trade deal in light of the events of the past week.