US-China trade talks 'back on track': White House advisor

US-China trade negotiations are now headed in a positive direction following this weekend's meeting between President Donald Trump and his Chinese counterpart Xi Jinping, a top White House aide said Tuesday.

But trade advisor Peter Navarro said Chinese telecoms giant Huawei remains blocked from participating in the development of 5G wireless networks in the United States even though Washington has softened its stance toward the company.

"From an investor's point of view, here is all you have to know: Talks are back on track with the work that has been done to date," Navarro told CNBC.

After talks nearly collapsed in May, Trump and Xi on Saturday agreed at a meeting in Japan to resume negotiations toward ending their year-long trade war.

Markets were encouraged by the development, which averted further deterioration in trade ties that has weighed on the global economy.

But stocks were struggling on Tuesday, in part because after Washington threatened heavier tariffs on European goods in a dispute over subsidies to aircraft maker Airbus.

Navarro said Tuesday that all that was at issue in Saturday's agreement on Huawei was "a small amount of chips" with negligible implications for spy craft.

"President Xi requested some relief on Huawei," he said. "Here is the important thing. US policy on Huawei with respect to 5G in this country has not changed."