04.09.2019 – Daily report. The DAX is recovering, and US futures are also picking up. Hopeful signals from China support. But the music is not playing in online stock trading and not on the stock exchange. On Wednesday, the currency market is more likely to become turbulent. Because in London the Brexit battle continues cheerfully.
German stocks in demand again
Investors in Frankfurt picked up again, with the DAX recently rising by 1.3 percent to 12,068 points. Great Britain dominated the news events. And the latest development in China also brought relief.
Rally in Hong Kong
According to a media report, Carrie Lam, head of Hong Kong’s government, wants to withdraw the extradition law responsible for weeks of riots. The law should allow Hong Kong to transfer suspects to the Red Chinese judiciary. The South China Morning Post reported that Lam will shortly inform the public about the decision. The Hang Seng closed with a solid plus of 3.9 percent at 26,523 points. The blue chips of the People’s Republic of China grew moderately, the CSI-300 gained 0.8 percent to 3,886 points. In Tokyo, the Nikkei 225 benchmark index closed trading at 20,649 points, almost unchanged at plus 0.1 percent.
Hope in the trade dispute
With the withdrawal of the law, the anger of the people in Hong Kong should also subside. This would also remove a potential obstacle in the customs negotiations between China and the USA – unlike Europe, which is always intent on appeasement, US President Donald Trump warned Beijing against a violent solution and threatened it with reactions in the customs negotiations. Incidentally, according to the CNBC, Trump has recently cooked hard. After the Chinese announcement on 23 August to impose duties on US goods worth 75 billion dollars, he had actually planned twice as high US counter-tariffs. The two negotiators, finance minister Steven Mnuchin and consultant Robert Lighthizer, according to information from CNBC, then successfully sent several CEOs to the telephone to slow down Trump.
Battle for Brexit
Speaking of political anger: The British pound is the focus of currency traders, volatility is guaranteed. With Prime Minister Boris Johnson’s defeat in parliament, the opposition and conservative rebels have cleared the way for a new vote. 328 parliamentarians yesterday voted in favour of a resolution paving the way for a law against a no-deal brexit – 301 parliamentarians opposed it.
Today, Wednesday, a vote will be taken on the draft law, which provides for a three-month postponement of the Brexit date until 31 January 2020, if no Brexit contract is concluded before that date. With which Brussels could de facto simply sabotage all negotiations with London until unlimited end in order to ensure in cronyism with the British retainers that the net payer Great Britain cannot leave the EU after all.
Johnson, for his part, announced that he would be submitting an application for new elections on Wednesday. We suspect that the House of Commons will reject it. Because the left-wing Labor Party and all those who stand in the way of the will of the people in the matter of Brexit must fear being sent to the desert and losing their well-paid little post. Especially the 21 conservative deserters who have meanwhile been thrown out of the Tory faction. So: Keep an eye on your free real-time prices and keep market access open!
Losses in New York
Wall Street had reset the night before. The reason: The purchasing managers’ index for US industry slipped surprisingly sharply to 49.1 points, thus falling below the growth threshold of 50 points for the first time since 2016. The Dow Jones closed 1.1 percent lower at 26,118 points. The S&P 500 slipped 0.7 percent to 2,906 positions. The Dow Jones thus closed the price gap below 26,200 that had been torn last week. The Nasdaq Composite lost 1.1 percent yesterday to 7,874 points.
This is what the day brings
The calendar brings some interesting events, you can find the overview as always here: Market Mover
First, the US trade balance is due for July, at 2:30pm.
At 8:00pm, the Federal Reserve’s Beige Book comes into focus.
At 9:15pm German time, Charles Evans, head of the Fed in Chicago, will speak in Detroit on the topic “North American Trade: The Auto Sector”. He is entitled to vote in the Open Market Committee, which decides on interest rates.
After 10:00pm Deutsche Börse reports the composition of the stock indices.
The data on the US crude oil stocks of the American Petroleum Institute will continue to run on the tickers at 10:30pm.
The Bernstein-Bank wishes successful trades!
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