17.07.2019 – Daily report. Always waiting at the start of trading day. Also on Wednesday the pattern of the past days was repeated on the Frankfurt Stock Exchange. Despite Wall Street highs, hopes for US interest rates and a relaxation in Iran. It remains to be seen whether the German benchmark index will pick up speed in the afternoon.
Lazy business in Frankfurt
Until midday, the DAX held up listlessly with a minus of 0.1 percent, just over 12,400 points. And the general conditions are not so bad at all: the evening before in Paris, US Federal Reserve Chairman Jerome Powell had again declared the Fed’s willingness to lower the key interest rate. The Federal Reserve would “act appropriately if necessary”. And the Dow Jones had also briefly reached a new all-time high the evening before. There were also positive signals regarding Iran.
Relaxation in the Persian Gulf
Iranian Foreign Minister Javad Zarif said in an interview with NBC News that Tehran is still sitting at the negotiating table – the USA has left him. But America is always welcome to return. The enrichment of uranium could be stopped within hours. US President Donald Trump and Secretary of State Mike Pompeo picked up the ball in front of journalists in the White House. Trump said it wasn’t about a regime change, “we want them out of Yemen.” And Pompeo added that Tehran is now ready to negotiate its missile program for the first time. The oil market reacted with falling prices.
Trump threatens China
However, there was also a drop of bitterness in global trade. US President Donald Trump dampened hopes that the conflict with China could be resolved in the near future. Trump said it was still a long way to an agreement with the People’s Republic. In addition, the president threatened that he could imagine imposing further import duties against the People’s Republic. In Tokyo, the leading Nikkei index fell by 0.3 percent to 21,469 points on Wednesday. The Chinese CSI-300 crumbled by 0.1 percent to 3,805 points.
Wait and see on Wall Street
Trading in New York was quite tough on Tuesday. The Dow did reach another record high in early trading. Thereafter, however, the leading index moved only slightly and closed with a minus of 0.1 percent at 27,336 points. The S&P 500 lost 0.3 percent to 3,004 points.
The Old Economy is currently showing its vitality: Turnover in the US retail sector rose more strongly than expected in June. The prices of imported goods had fallen more sharply than at any time in almost three years – the trade dispute with China has therefore by no means had a negative impact on American consumers. However, industrial production and capacity utilization showed a mixed picture, with inventories rising in May. But the mood on the US housing market had brightened in July. As always, you can find all economic data here: Market Mover
What remains is the view of the New Economy. The Nasdaq 100 closed yesterday 0.5 percent lower at 7,927 points. This is a development that CFD traders should keep an eye on: Trump apparently takes a statement by investor Peter Thiel seriously, who indirectly accuses Google of treason and too close cooperation with the Chinese military. Trump twittered that his administration would take a look.
The end is near
Bitcoin, Ethereum, Litecoin, Eos, etc. are also facing adversity – the courses are currently in a real deep intoxication. The USA apparently wants to put the digital substitute currencies on a leash. On Tuesday, US Treasury Secretary Steve Mnuchin declared the use of crypto currencies a “danger to national security”. The politician used heavy verbal guns: “Cybercrime, tax evasion, blackmail, illegal drugs and human trafficking” – all this was financed with it. The state would not ban crypto currencies, Mnuchin said, but it would enforce compliance with financial market rules. In addition, the seven most important industrial countries also want to limit the risks of new digital currencies, according to French figures.
This is what the day brings
Wednesday will see some important data and quarterly figures, so keep an eye on your trading platform.
So Netflix, IBM, Alcoa and Ebay report from 10:00pm German time.
Prior to that, the US construction starts and permits for June are due at 2:30pm.
At 4:30pm the inventory data of crude oil of the national Energy Information Administration follow.
And at 8:00pm the Beige Book gives an insight into the mood of the Federal Reserve.
In addition, the G7 meeting of finance ministers and central bank governors in Chantilly runs until tomorrow. Important news for stocks, bonds and foreign exchange can be expected here at any time.
So the table is richly set – make sure that your direct market access with a broker with a Bafin license is always open.
The Bernstein Bank wishes you successful trades!
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