UPDATE - Trump to hold 'extended meeting' with China's Xi

ADDS WHITE HOUSE READOUT OF TELEPHONE CALL IN GRAFS 5-6

By Michael Hernandez

WASHINGTON (AA) - U.S. President Donald Trump said Tuesday he will hold a sit-down with Chinese President Xi Jinping next week amid an ongoing trade dispute between the world's top two economies.

"We will be having an extended meeting next week at the G-20 in Japan," Trump said on Twitter. "Our respective teams will begin talks prior to our meeting."

China and the U.S. have been locked in a bitter trade war, imposing reciprocal tariffs after Trump unleashed the opening salvo because of grievances stemming from the lopsided trade imbalance between the countries and what the U.S. insists are unfair trade practices.

Beijing had previously declined to confirm Xi would attend next week's gathering of leaders of the world's top 20 economies. Trump threatened to impose additional tariffs on Chinese goods if Xi refused to meet him during the two-day summit in Japan.

During their telephone call Tuesday, Trump and Xi "discussed the importance of leveling the playing field for U.S. farmers, workers, and businesses through a fair and reciprocal economic relationship," the White House said in a statement.

"This includes addressing structural barriers to trade with China and achieving meaningful reforms that are enforceable and verifiable," it said, noting the leaders also addressed "regional security issues" without elaborating.

The U.S. and China have slapped tariffs on hundreds of billions of dollars worth of each other's goods, and Trump threatened to impose duties on $300 billion worth of additional of Chinese imports in May after trade negotiations faltered that month without a long-sought deal.

U.S. markets continued to rally Tuesday following Trump's tweet with the Dow Jones industrial average up 300 points in mid-morning trading.