THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
LINDA STOUFFER, CNN ANCHOR: We are following breaking news: big development out of China in the U.S.-China standoff -- word now that the U.S. crew members will be released. We understand from our Rebecca MacKinnon in Beijing that this will not be instantaneous. Some details have to be worked out. But the headline: The U.S. crew members, the 24 crew members, who are now in their 11th day on Hainan Island in China, will be released.
We are expecting the news conference just less than a half-hour from now -- a news conference live out of Beijing, simultaneous news conference out of Hainan Island. We will see what officials have to say at that point. And, of course, CNN will be bringing you those developments live.
JASON CARROLL, CNN ANCHOR: And to get the very latest from Hainan Island, right now, we want to go to our Lisa Rose Weaver, who is there.
Lisa, what can you tell us?
LISA ROSE WEAVER, CNN CORRESPONDENT: Well, Jason, we are expecting, as you said, a press conference at the top of the hours, 7:00 p.m. in the evening this time of. As far as we know, only the Hainan foreign affairs office is giving that press conference. We do not know if the American side will be a part of that.
Now, in the past, after the U.S. officials have been able to meet with the detained crew members, both sides have each given a statement. The U.S. officials are waiting for the call for a meeting today with the crew members. They have not been able to tell us if they are expecting to hear about a release at such a meeting. They're not able to tell us exactly when they would have a meeting with them later on tonight.
What we do know is that, while we're expecting the Chinese side to give a statement, it may be in reaction to the fact that the Chinese media has reported that the United States is -- quote, end quote -- "very sorry" for the incident of the collision, now more than a week ago.
The Chinese-run media statement does not specify exactly what part of the incident. It goes on to say that both Secretary of State Powell and President Bush have expressed their sincere regret over China's missing pilot and the aircraft, conveying to the family of the pilot -- of pilot Wang Wei that the U.S. side is very sorry for their loss -- Jason.
CARROLL: Lisa, any idea what we expect to hear in this press conference on Hainan Island that we will not hear in the other press conference that will be going on at the same time?
WEAVER: Well, if the press conference in Beijing announces a release of all or some of the crew, we would expect to hear a mirror image of that here in Hainan. Generally, news out of Beijing coming from a higher level of the Chinese government takes precedence over announcements being announced at the local level. But, again, we've been constantly in touch with the U.S. officials here as part of this delegation who have been pressing now for more than a week for the release of the crew. And they're just not able to tell us if they are anticipating that kind of statement -- Jason.
STOUFFER: OK, Lisa Rose Weaver, on Hainan Island, thank you very much for that update.
And again, we are awaiting this press conference at 7:00 a.m. Eastern Time, just about 25 minutes from now.
I've just been handed a piece of paper that says: a printout from the Internet from China's "People's Daily." And I want to read you the statement that they have posted there.
It says, "The U.S. side must take full responsibility for the incident." It cites a foreign minister -- A Chinese foreign minister said in Beijing that, "Since the U.S. government has already said -- quote -- 'very sorry' to the Chinese people, the Chinese government has, out of humanitarian considerations, decided to allow the 24 people on the U.S. spy plane to leave China after completing the necessary procedures."
Now, he goes on to say, according to this report, that this foreign minister received a letter handed to him by the U.S. ambassador to China at about 5:30 p.m. "In the letter, the U.S. government said 'very sorry' for the incident of the U.S. military reconnaissance plane ramming into and destroying a Chinese military aircraft."
Now, I was just handed that -- that again from China's "People's Daily." We printed it out off the Internet. And I should point out here that the U.S. government has been saying all along that they believe that the crew of the U.S. spy plane did nothing wrong, that they were flying in international airspace when the collision with the Chinese fighter jet occurred. China has been accusing the U.S. of practically invading Chinese territory by actually having to make that emergency landing on the Chinese airstrip.
CARROLL: And, again, we just want to remind our audience that there are going to be two press conferences going on simultaneously, one in Beijing, one on Hainan Island. Both will happen at about 7:00 a.m. CNN is going to bring you live developments from the story as soon as they become -- as soon as they become available. Right now, though, we want to go to New York and get the market reaction to what's happening in China.
David, what can you tell us?
DAVID HAFFENREFFER, CNN ANCHOR: Well, Jason and Linda, we have seen a bit of a turnaround in the futures this morning on the heels of this news coming out of China. As you can see here, we've got the Nasdaq 100 index futures up by nine points and S&P futures up by 1 1/2 points. Both of those indicators had been trading to the downside just prior to the announcement and the news coming out of China this morning.
We want to bring in Patricia Chadwick, president of Ravengate Partners.
PATRICIA CHADWICK, PRESIDENT, RAVENGATE PARTNERS: Good morning.
HAFFENREFFER: We're seeing this news come out this morning. This has had an impact, this ongoing situation, on the financial markets. It looks like we could see a positive spin to this this morning.
CHADWICK: Well, I think it's been in the background. And we've had rallies and we've had pullbacks while it's been ongoing. But I think, when you have a political situation that's that momentous, it does have an impact on the market. So I have to think this is good news.
Obviously, there looked as though there might be some economic impacts on China. We saw that Kmart was talking about boycotting or, you know, not taking in their products. I think there was beginning to be some groundswell in this country by citizens saying we're going to try to have an impact, an economic impact, on China. So I think the settlement is definitely favorable.
HAFFENREFFER: Will the return of the 24 crew members back to the U.S., you think, withdraw all the uncertainty out of the financial markets about the situation? Or are there still some straggling issues?
CHADWICK: Well, there's the plane as well. So, obviously, there are a lot of other issues. And I'm certainly not, you know, involved in any of that kind of understanding of what's going on there.
But I do think that the most important thing is people. And I think that it will cease to be a front-page issue, I think, once the crewmen -- people are back home.
HAFFENREFFER: And once this is resolved, the Street can get back to focusing on, no doubt, Fed, earnings, other issues that have been on the...
CHADWICK: Which... HAFFENREFFER: ... in the foreground all along.
CHADWICK: Yes. And I think that the China issue has been very much in the background. But I think it has been something that's been a concern to people because, obviously, an unsettled political environment does, of course, impact the market. But the most important issues are economic ones.
And we are continuing to look at what I think has been some signs that maybe we've had a lot of inventory correction now taken out of the economy, and that we're starting to maybe see some signs of a pickup in the economy because the inventory correction has been fast, but quite severe. And so I think now we can look forward maybe to some better news as we head into the second quarter.
HAFFENREFFER: Despite the fact that this news about China, at least for the financial markets, has been sort of on the periphery, is this the type of -- the resolution of this issue, is this the type of news that's likely to pull fresh money in off the sidelines?
CHADWICK: I think that what starts to happen is, if the political environment is better and the economic environment looks better, now you've got two things that are better. I think, if the economic environment was getting better and you still had this political, you know, hangover, if you will, I think that that would be concerning a number of people, particularly because the longer it went on, the more serious it was going to become, I think.
So this is important that it looks as though it's going to come to a resolution.
HAFFENREFFER: All right, Patricia, thank you very much.
CHADWICK: Thank you.
HAFFENREFFER: Patricia Chadwick from Ravengate Partners -- back to Jason and Linda in Atlanta.
STOUFFER: Well, no matter what happens in the markets, this is very good news to the friends and family of those 24 U.S. crew members. This is the news U.S. officials have been waiting to hear, news that those crew members will be released. We don't know if it will be minutes, hours, days, but we we'll be following it.
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