07.05.2019 – Daily report. After the downward slide at the beginning of the week, the DAX also commuted a bit downwards on Tuesday morning. Bad news for the bulls: German equities are hovering slightly above the 50-day moving average. In addition, the US futures also showed themselves into the red. If you trade CFDs, you must therefore keep an eye on market updates on a regular basis – you must constantly reckon with bad news.
Customs dispute brings heavy volatility
The stock market is so close to the spoilage: what initially caused howling and gnashing of teeth was quickly reinterpreted. This is what happened on Monday: After a violent early crash on Wall Street, shares in New York caught up with some losses until the end. Analysts had interpreted the new punitive tariffs threatened by US President Donald Trump as a whip for the Chinese in the negotiations. In addition, the suspicion paved the way that Trump had started his threatening manoeuvre because the US indices had reached their all-time highs. CNBC also reported that the Chinese delegation of about 100 men will now travel to Washington on Thursday after all. One day later than planned, but at least. So everything is half as wild? At any rate, the stock exchanges do not rate the talks as having yet broken down.
And then the fear set in again that the US futures slid south again on Tuesday morning. According to the financial portal Marketwatch, US Treasury Secretary Steven Mnuchin had stressed that the new special duties announced by Trump would take effect on Friday without delay at 12:01pm Eastern Time. How can an agreement be reached in such a short time? In front of journalists, the US administration also revealed details about its harder course: China had tried to wriggle out of some already negotiated formulations. Ultimately, then, that would be a breach of speech – whether this rift can be repaired?
New Interim Reports
These were tough times for the DAX, which initially remained robust on Tuesday but then plunged by around 0.5 percent. Four DAX companies provided some distraction during the reporting season. The profits of the Vonovia real estate group rose sharply in the first quarter. The chip manufacturer Infineon performed somewhat better than expected between January and the end of March. BMW slipped into the red due to a provision of billions for a threatened antitrust fine by the European Union. And at Henkel, Henkel’s adjusted operating profit was slightly higher than forecast.
The 50-day line lures from below
But unfortunately there is no all-clear for the bulls: The DAX still hovers quite far above the 50-day line, which runs at around 11,794 points and is considered important support for chart analysts. This makes it an almost magical attraction for the DAX during bear markets. And while we are chatting so nicely about the chart technique: The Dow Jones stopped pretty much exactly at the 50-day moving average during its small slide on Monday and then recovered again. The Dow finally left trading with only a small minus of 0.3 percent at 26,438 points. The market-wide S&P 500 lost 0.5 percent to 2932 points at the end of trading and the technology-heavy Nasdaq 100 lost 0.7 percent to 7794 points. Both indices are still well above the 50-day average.
Nervous flutter in Asia
The view to the east remains, where valerian was highly valued by plagued stockbrokers. The news that China’s deputy prime minister and leading negotiator Liu Hen will also participate in the customs negotiations on Thursday and Friday in Washington provided initial confidence. The whole thing will probably not be a show event. In Tokyo, the Nikkei bid farewell on Tuesday with a minus of 1.5 percent at 21,924 points. However, this was the first trading day in the course of the Golden Week at the change of throne. The Shanghai composite even recovered by 0.7 percent to 2,926 percent. On Monday, the Chinese stock exchange had suffered the strongest losses for more than three years.
This is what the day brings
This brings us to the outlook. Apart from the customs dispute, there are hardly any major events planned. The US consumer loans, for example, are scheduled for March and are due to arrive at 9 p.m. German time. We wish you a healthy portion of coolness and successful trades!
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