News

05.06.2023 – The dust is slowly settling at Nvidia. Recently, the company triggered a veritable stampede of bulls: the new mega-trend of artificial intelligence brought the chip and graphics card manufacturer a boom in orders. The stock shot up and set a new daily record on Wall Street with a gain of around 30 percent. Now investors are eagerly eyeing a gigantic price gap.

We brought this note here a long time ago: Mind the Gap. Anyone who rides the subway in London knows the famous announcement: watch out for the gap between the train and the platform. The gap in Nvidia’s daily chart is huge. It could well be that this Artificial Intelligence (AI) Gap will be closed at some point. Probably when some of the high hopes for AI dissipate into thin air.

Source: Bernstein Bank GmbH

For the time being, however, everything still looks rosy. The graphics card specialist exceeded the average expectations of analysts by around 50 percent with its sales forecast. Company CEO Jensen Huang spoke in a conference call of “incredible orders” for upgrading data centers. Nvidia chips and software are increasingly being used for artificial intelligence-based applications.

Smarty-pants from the web
We had already talked about the boom in ChatGPT and co. at this point. The current hype is somewhat reminiscent of the euphoria in the dotcom bubble. Just like the dotcom bubble, the AI boom could burst if a few nasty quirks aren’t fixed. For example, the various smart search engines sometimes spit out abstruse results. A few days ago, a lawyer in New York who had used the ChatGPT search engine made headlines. In his plea, he cited the cases “Petersen v. Iran Air” or “Martinez v. Delta Airlines” – which, however, simply do not exist.
We are also curious to see whether the predictions that entire occupational groups such as speakers, journalists, call center employees or even doctors and even lawyers will become obsolete will come true. Anyone who has taken a closer look at the texts and spoken pieces will understand that the results spat out seem strangely soulless and artificial. Sometimes the cool counselors have to correct themselves. Maybe that will change, maybe never.

Put on the AI?
Whatever the case, Nvidia has virtually become a lodestar for artificial intelligence from here on out. If the glitches pile up or regulation intervenes heavily, the stock could go supernova. Just imagine a doctor making a fatal misdiagnosis based on artificial intelligence. Or, AI continues to boom and competitors get in – pushing Nvidia aside. Then the big price gap magically beckons. Or else, Nvidia continues to zoom upwards as the ring leader. We are curious to see how the exciting topic of AI develops further – Bernstein Bank wishes successful trades and investments!

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The content of this publication is for general information purposes only. In this context, it is neither an individual investment recommendation or advice nor an offer to purchase or sell securities or other financial products. The content in question and all the information contained therein do not in any way replace individual investor- or investment-oriented advice. No reliable forecast or indication for the future is possible with respect to any presentation or information on the present or past performance of the relevant underlying assets. All information and data presented in this publication are based on reliable sources. However, Bernstein Bank does not guarantee that the information and data contained in this publication is up-to-date, correct and complete. Securities traded on the financial markets are subject to price fluctuations. A contract for difference (CFD) is also a financial instrument with leverage effect. Against this backdrop, CFD trading involves a high risk up to the point of total loss and may not be suitable for all investors. Therefore, make sure that you have fully understood all the correlating risks. If necessary, ask for independent advice. CFDs are complex instruments and are associated with the high risk of losing money quickly because of the leverage effect. 68% of retail investor accounts lose money trading CFD with this provider. You should consider whether you understand how CFD work and whether you can afford to take the high risk of losing your money.7

02.06.2023 – The supreme law in sales is: know your customer. Sometimes the day comes when it turns out that some decision-makers live in a closed parallel world and float like oil on water. If they then want to educate the clientele, things go wrong. That’s what happened with Bud Light. Which sometimes earns traders whopping profits.

Almost exactly two months ago, someone wanted to be progressive in marketing and give the icon of the American beer industry a radical image change. The Bud Light beer brand was once something like the epitome of mainstream America: good humor, patriotism, baseball, football, barbecues with the family. Down-to-earth, with sturdy Clydesdale horses in front of the beer carriages as sympathy carriers in the advertising – visitors to the Oktoberfest know this.

To “fratty”
And then an incredibly woke manager came along who thought the beer brand was too “fratty” – that is, too much aligned with the fraternities at the universities. Ergo, she came up with the fabulous idea of hiring a transvestite. Dylan Mulvaney celebrated “365 Days of Womanhood” with his own likeness on the blue beer cans. And so the whole group came under fire.

The supreme law in sales is: know your customer. Sometimes the day comes when it turns out that some decision-makers live in a closed parallel world and float like oil on water. If they then want to educate the clientele, things go wrong. That’s what happened with Bud Light. Which sometimes earns traders whopping profits.

Source: Bernstein Bank GmbH

You can see the result in the daily chart of Anheuser-Busch Inbev: quite a crash. The stock has now lost 20 percent, according to “Forbes,” reaching bear market territory since the transgender promotion kicked in at the end of March. In just two months, the stock has burned through about $26 billion in market cap, according to the report.
In the U.S., the already fierce culture war has flared up again over the issue. The regular customers turned away – in the football stadiums, the Bud Light stands remained empty, the beer lies on the shelves like lead. The sales losses are enormous: Goldman Sachs referred to data from NielsenIQ, according to which Anheuser-Busch has recorded a 10 percent drop in sales in each of the past four weeks compared to the previous year.

Get woke – go broke
True, there have been more severe bear markets because of Corona and the temporary end of public life. But this time things are different – the competition has not been hit. On the contrary, the stock of competitor Molson Coors – with its Coors Light and Miller Light brands – has gained about 20 percent in the same period. The question is whether the storm will eventually subside. Wall Street, at any rate, is still quite bullish, according to “Forbes.” Nearly three dozen analysts surveyed by FactSet see an average price target of $67 per share.
“Forbes” referred in its online edition, by the way, to other corporations that are quite queer and have recently suffered share price losses: retailers Target and Kohl’s, for example, but also Nike, Adidas and North Face.

By the way, “Forbes” referred in its online edition to other corporations that pretend to be quite queer and have recently suffered share price losses: the retailers Target and Kohl’s, for example, but also Nike, Adidas and North Face.
The moral of the story: smart traders keep an eye on companies that have obviously lost touch with the mass of their customers and tend to communicate with the cultural chic. And therefore unexpectedly face a boycott. These are typical short candidates. Conversely, stocks of companies that weather the storm or counteract it offer nice turnaround opportunities. Bernstein Bank wishes you good luck in scouring the market!

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The content of this publication is for general information purposes only. In this context, it is neither an individual investment recommendation or advice nor an offer to purchase or sell securities or other financial products. The content in question and all the information contained therein do not in any way replace individual investor- or investment-oriented advice. No reliable forecast or indication for the future is possible with respect to any presentation or information on the present or past performance of the relevant underlying assets. All information and data presented in this publication are based on reliable sources. However, Bernstein Bank does not guarantee that the information and data contained in this publication is up-to-date, correct and complete. Securities traded on the financial markets are subject to price fluctuations. A contract for difference (CFD) is also a financial instrument with leverage effect. Against this backdrop, CFD trading involves a high risk up to the point of total loss and may not be suitable for all investors. Therefore, make sure that you have fully understood all the correlating risks. If necessary, ask for independent advice. CFDs are complex instruments and are associated with the high risk of losing money quickly because of the leverage effect. 68% of retail investor accounts lose money trading CFD with this provider. You should consider whether you understand how CFD work and whether you can afford to take the high risk of losing your money.7

01.06.2023 – The bulls need a good cup of coffee first: Contrary to the general trend in soft commodities, the price has recently dropped. We explain the background.

This is what a nice, albeit short-term bearish downtrend looks like, here the four-hour chart of Arabica in cents per pound. However, the question is whether the recent price action is a knock on the upper end of the channel, or a run-up to a breakout.

Source: Bernstein Markets GmbH

Arabica rallied yesterday as the Intercontinental Exchange (ICE) cited inventory levels at affiliated dealers of around 592,000 bags, a six-month low.

Strong exports in Vietnam
The Robusta variety, on the other hand, came under pressure from news last Sunday from Vietnam, with the General Department of Vietnam Customs reporting that coffee exports rose 15.7 percent month-on-month in May, according to financial blog Barchart. Which more than offsets a 2.2 percent decline in exports from January to May. Vietnam is the world’s largest exporter of Robusta beans. The USDA Foreign Agricultural Service (USDA FAS) had also recently stated that Vietnam’s coffee harvest in the 2023/24 season would likely increase by 5 percent to 31.3 million bags.
The two varieties usually run pretty much in unison – when one becomes cheaper, traders focus on it, therefore demand dwindles for the other, dragging prices down. So let’s look at the current global facts in the coffee market.

Good harvest conditions in Brazil
The determining price factor is, of course, agriculture. Brazil, for example, reported an accelerated harvest due to dry weather. The weather service Somar Meteorologia reported zero rain for the previous weekend in the Minas Gerais region – the growing area accounts for around 30 percent of the Brazilian harvest. The weakness of the Brazilian real is also bearish for coffee because it stifles nationwide consumption and increases the incentive to export.
Recently, the U.S. Department of Agriculture had also given fodder to the bears. According to the report, Colombia’s production would pick up by 2 percent to 11.6 million bags in the 2023/24 season. Colombia is the world’s second-largest producer of arabica.

Indonesia and El Ninio
Meanwhile, the market is threatened with increased unwinding of long positions, according to financial blog Barchart. That is, speculators could throw in the towel because the price is going against them. Last week, the weekly Commitment of Trader’s (COT) report with about 43,000 net long positions as of May 23, a 16-month high.

A glimmer of hope for the bulls: Robusta production in Indonesia is likely to slump by a fifth to 8.4 million bags in the 2023/24 crop, according to USDA FAS. Heavy rains, in fact, prevent pollination of the plants, it said. Indonesia is the third largest producer of Robusta.
Now, eyes are turning to the El Ninio weather phenomenon – this could cap production. On May 11, the U.S. Climate Prediction Center raised the probability of the phenomenon occurring from 74 percent a month earlier to 94 percent now. El Ninio could mean too much rain for Brazil and drought for Indian. So keep an eye on the real-time news – Bernstein Bank wishes you successful trades and investments!

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The content of this publication is for general information purposes only. In this context, it is neither an individual investment recommendation or advice nor an offer to purchase or sell securities or other financial products. The content in question and all the information contained therein do not in any way replace individual investor- or investment-oriented advice. No reliable forecast or indication for the future is possible with respect to any presentation or information on the present or past performance of the relevant underlying assets. All information and data presented in this publication are based on reliable sources. However, Bernstein Bank does not guarantee that the information and data contained in this publication is up-to-date, correct and complete. Securities traded on the financial markets are subject to price fluctuations. A contract for difference (CFD) is also a financial instrument with leverage effect. Against this backdrop, CFD trading involves a high risk up to the point of total loss and may not be suitable for all investors. Therefore, make sure that you have fully understood all the correlating risks. If necessary, ask for independent advice. CFDs are complex instruments and are associated with the high risk of losing money quickly because of the leverage effect. 68% of retail investor accounts lose money trading CFD with this provider. You should consider whether you understand how CFD work and whether you can afford to take the high risk of losing your money.7

29.05.2023 – The election in Turkey is over. The old President Recep Tayyip Erdogan is also the new one. Investors flee, the lira marks a new all-time low. Now it is only a matter of time before things get really interesting again: The central bank will have to intervene.

A daily chart like the launch pad of a rocket in the past: USDTRY has broken through the sound barrier of 20. A few days ago, there was already a small foretaste of the coming forex battle: After a short flash crash, the central bank intervened, as reported by the financial blog “ZeroHedge”. Nevertheless, the magic mark of 20 has fallen.

Source: Bernstein Bank GmbH

According to “Zero Hedge”, the trigger for the recent turbulence was Clemens Grafe, forex strategist at Goldman Sachs. His analysis unfolded its effect on the lira since last Monday. The expert had reported this about the Turkish Central Bank: “net foreign assets fell by US$3.2bn to negative US$14.8bn”. He further warned, “given the slowdown in the rise of TRY deposits and this week’s decline, we think TRY liquidity in the system is becoming more limited.” The essence: capital flight from Turkey before the runoff election. And the central bank’s ammunition is dwindling.
Bloomberg, looking at volatility, reported as early as the first round of the election that the market was preparing for the lira to crash to 24. According to Bloomberg Economics, Turkey’s central bank shelled out $177 billion to support the lira between December 2021 and April. Before the election, foreign investors would have held only about $24 billion in Turkish assets. A decade earlier, there had been $150 billion in bonds and equities.

On and on with Erdoganomics
And now the same song. “Unless there is another fist-pumping surprise, Erdogan’s rule, along with the unorthodox policies described as the Turkish economic model, will probably continue,” explained Commerzbank analyst Tatha Ghose in an interview with “Tagesschau.” All economists see interest rate hikes as an effective means of fighting inflation. Only Erdogan does not. The central bank just left the key interest rate unchanged at 8.5 percent. And that with an official inflation rate of still 44 percent.

Prepare for intervention

We suspect: The new government is likely to make an example of the lira again soon, in order to mow down lira shorts. Officially, it is always said that only evil speculators are responsible for the currency’s decline. There is probably still money for intervention. In a recent interview with CNN Turkey, Erdogan said: “Our economy and the banking and financial system are quite strong. Meanwhile, some Gulf countries have put money into our system – even if it is only for a short time.” After the May 28 runoff election, he said, he would thank the donors. Erdogan did not name any countries or sums. What is known is that Turkey has concluded swap deals with the United Arab Emirates, China, Qatar and South Korea worth about $28 billion in recent years.
The bottom line is that the lira offers tremendous short-term opportunities for savvy traders. It is not impossible that the central bank times just multiply the interest rate for the overnight loan to eliminate shorts. Which should strengthen the lira in the short term. In the long term, however, we see little hope for the currency – but let’s be surprised. Whether long or short – Bernstein Bank wishes successful trades and investments!

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The content of this publication is for general information purposes only. In this context, it is neither an individual investment recommendation or advice nor an offer to purchase or sell securities or other financial products. The content in question and all the information contained therein do not in any way replace individual investor- or investment-oriented advice. No reliable forecast or indication for the future is possible with respect to any presentation or information on the present or past performance of the relevant underlying assets. All information and data presented in this publication are based on reliable sources. However, Bernstein Bank does not guarantee that the information and data contained in this publication is up-to-date, correct and complete. Securities traded on the financial markets are subject to price fluctuations. A contract for difference (CFD) is also a financial instrument with leverage effect. Against this backdrop, CFD trading involves a high risk up to the point of total loss and may not be suitable for all investors. Therefore, make sure that you have fully understood all the correlating risks. If necessary, ask for independent advice. CFDs are complex instruments and are associated with the high risk of losing money quickly because of the leverage effect. 68% of retail investor accounts lose money trading CFD with this provider. You should consider whether you understand how CFD work and whether you can afford to take the high risk of losing your money.7

26.05.2023 –  The panic has subsided, normality has returned. In other words, the market is ruling again, not the military. Since the high immediately after the Ukraine invasion, the wheat price has more than halved. The question is whether the downward trend will continue.

The blog “Invezz” just judged that there is no end in sight for the bear market in the short term. Thus, the wheat price – here the daily chart – first tore the support of 720 dollars. After that, the support at 596 had fallen. We have marked both levels with red lines. The verdict of “Invezz”: “Therefore, there is a possibility that the price will continue falling as sellers target the key support at $500.”
Whereby we briefly object at this point: The zone just below $600 seems to us to be still quite contested at the moment. We don’t see a final collapse of support here yet. Just look at how long it took until the 720 was finally broken through. Short bounces to the upside would not be a surprise – which should please bullish traders.

Source: Bernstein Bank GmbH

Be that as it may, the good news for the bears recently outweighed the bad news. About two weeks ago, the U.S. Department of Agriculture presented its first outlook for the 2023/24 harvest. The bottom line: a slight increase in production with demand picking up and inventories expected to fall slightly.

USDA figures
However, the USDA also slightly capped projections for 2022/23, with output from Ukraine in particular expected to fall, and the same for North Africa. At the same time, however, according to the World Agriculture Supply and Demand Estimates (Wasde), the buffer in the “old crop” increased by 1.23 million tons to 266.28 million tons compared to the previous outlook. Furthermore, the agency put the amount of the “new crop” at 264.3 millon tons – which was 7 million more than analysts had predicted to the blog “Fastmarkets Agriculture”.

Agreement extended
In addition, Russia and Ukraine agreed last week, with Turkish mediation, to extend the export agreement by two months. Both countries are major players in the grain market. Together, they account for nearly one-third of wheat exports, as reported by “Gro Intelligence,” which is a data service in the agricultural sector. In addition, Russia’s harvest isn’t due until July, so there’s still a lot of wheat that can hit the market. Bullish factors quickly evaporated recently, such as rumors that Russia was disrupting Ukrainian exports across the Black Sea.

At least “Invezz” saw signs of hope for the bulls – but only in the long term: “Still, in the long term, there is a likelihood that wheat prices will bounce back”. Thus, Ukraine’s output is likely to remain constrained for a long time. According to USDA, Ukraine will harvest about 16.5 million tons and export 10 million tons in the 2023/24 season. The comparative figures for the season before: 20.9 and 15 million tons. In addition, the harvest in Russia is likely to be 11 percent lower, he said. Furthermore, Australia will probably export a third less than normal due to the El Nino weather phenomenon. And then there is the fly in the ointment: Argentina will increase exports by 45 percent.
Our conclusion: We are curious to see whether many farmers will switch to other varieties in view of the predominantly bearish outlook. Then the bulls are likely to call the shots again. Only when? Whether long or short: Bernstein Bank wishes successful trades and investments!

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The content of this publication is for general information purposes only. In this context, it is neither an individual investment recommendation or advice nor an offer to purchase or sell securities or other financial products. The content in question and all the information contained therein do not in any way replace individual investor- or investment-oriented advice. No reliable forecast or indication for the future is possible with respect to any presentation or information on the present or past performance of the relevant underlying assets. All information and data presented in this publication are based on reliable sources. However, Bernstein Bank does not guarantee that the information and data contained in this publication is up-to-date, correct and complete. Securities traded on the financial markets are subject to price fluctuations. A contract for difference (CFD) is also a financial instrument with leverage effect. Against this backdrop, CFD trading involves a high risk up to the point of total loss and may not be suitable for all investors. Therefore, make sure that you have fully understood all the correlating risks. If necessary, ask for independent advice. CFDs are complex instruments and are associated with the high risk of losing money quickly because of the leverage effect. 68% of retail investor accounts lose money trading CFD with this provider. You should consider whether you understand how CFD work and whether you can afford to take the high risk of losing your money.7

25.05.2023 – About a month ago, we were still talking about the directionless trend in copper. Now it seems that things are moving: The price of the red metal has slid south and formed a downward trend. We take a look at the background.

The situation for copper has changed drastically in recent weeks, here the daily chart. The support in the sideways trend was convincingly broken at the beginning of May, now we see a rather clear bearish movement.

Source: Bernstein Bank GmbH

The Shanghai Metals Market online portal blamed the weaker-than-hoped recovery of the Asian economy for the price decline. It also said that supply is increasing and the strong dollar is slowing demand. In Europe, the situation was hardly different recently: Metal Bulletin reported all industrial metals were under pressure on the London Metal Exchange due to concerns about the national economy.
Analysts, meanwhile, are divided on the way forward. Goldman Sachs was recently bearish, while Bank of America was quite bullish.

Recession fears
Goldmen just lowered their average price target for this year from $9,750 to $8,698 per ton. Metal prices reflected the global recession, they said.
Analysts referred to the eurozone manufacturing price index, among others. The May PMI came in at 44.6 points, while most analysts had expected 46 points. Demand in the industrial sector is currently shrinking at the fastest pace since the closure of factories in the wake of Corona three years ago. In addition, the Markit Flash PMI in the U.S. slipped to 48.5 in May, which also signals contraction and was the lowest level in three months.

Hopes for China
Bank of America, on the other hand, sees things quite differently. It expects the price of copper to reach $10,000 per ton by the end of the year. This is mainly due to China – the People’s Republic is renewing its network of power lines.
Our conclusion: The recession issue will determine the further course of the copper price. Conversely, the red metal is also a leading indicator for global economic activity and thus also for the stock market. We are curious to see what will happen next – Bernstein Bank wishes successful trades and investments!

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The content of this publication is for general information purposes only. In this context, it is neither an individual investment recommendation or advice nor an offer to purchase or sell securities or other financial products. The content in question and all the information contained therein do not in any way replace individual investor- or investment-oriented advice. No reliable forecast or indication for the future is possible with respect to any presentation or information on the present or past performance of the relevant underlying assets. All information and data presented in this publication are based on reliable sources. However, Bernstein Bank does not guarantee that the information and data contained in this publication is up-to-date, correct and complete. Securities traded on the financial markets are subject to price fluctuations. A contract for difference (CFD) is also a financial instrument with leverage effect. Against this backdrop, CFD trading involves a high risk up to the point of total loss and may not be suitable for all investors. Therefore, make sure that you have fully understood all the correlating risks. If necessary, ask for independent advice. CFDs are complex instruments and are associated with the high risk of losing money quickly because of the leverage effect. 68% of retail investor accounts lose money trading CFD with this provider. You should consider whether you understand how CFD work and whether you can afford to take the high risk of losing your money.7

23.05.2023 – Rebound and triple top or breakout to the upside? Things are getting interesting for the DAX after the new record. We dare to take a look into unknown territory.

Here’s how it can go: Ukraine war, inflation, recession fears, rising interest rates – it doesn’t matter. As recently as September of last year, the DAX was trading at around 12,000 points. But after a month-long upswing, the German share index has just marked a new record high. In the course of trading, the DAX reached 16,333 points on Friday. Now it has reset, here’s a look at the weekly chart. Is the index taking a run-up or is that it? It is clear that the price barometer is moving in unknown territory – uncharted territory.

Source: Bernstein Bank GmbH

For many chart technicians, a new high is a great buy signal. However, the question is whether the German leading index will not form a triple top, which would please the bears. It is interesting to note that the DAX first retraced after the previous price run at the end of 2021 in the wake of a double top. The question is how it will do now.
The bullish factors
Let’s look back first. “Focus Online” cited four reasons for the new bull market: first, the group balance sheets were better than expected. Second, inflation is easing and exports are picking up. Furthermore, energy prices are currently heading south again. Furthermore, the USA is unlikely to descend into chaos in the debt dispute. But there is more.

FOMO
We think: There is apparently a fear of missing out – Fear of Missing out – among big houses. And those who haven’t jumped on the bandwagon now could soon make up for it. Analyst Daniel Saurenz from Feingold Research also sees it that way: “Because many investors, especially professionals, have missed the rally and desperately have to buy after it”. But that is absurd, he says, because the stock market records are facing an enormous headwind from rising interest rates and mediocre economic data at best.
If the upward breakout does not turn out to be a flash in the pan, new highs are likely to be the result, Christian Henke of broker IG predicted, according to Tagesschau.de. “The next stage target would then be the next round number at 17,000 points.”

The arguments of the bears
For Pierre Veyret of trading house Activtrades, this speaks against a further run to the upside: “Stubborn inflation, slowing recovery momentum in China, monetary tightening and weaknesses in U.S. employment data and the banking sector could still be seen as dark clouds for investors,” the market analyst recently warned, according to Tagesschau.de. We add: In the Ukraine war continues to threaten an escalation, Taiwan could also become an explosive crisis. We are curious to see what happens next – and wish you successful trades and investments!

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The content of this publication is for general information purposes only. In this context, it is neither an individual investment recommendation or advice nor an offer to purchase or sell securities or other financial products. The content in question and all the information contained therein do not in any way replace individual investor- or investment-oriented advice. No reliable forecast or indication for the future is possible with respect to any presentation or information on the present or past performance of the relevant underlying assets. All information and data presented in this publication are based on reliable sources. However, Bernstein Bank does not guarantee that the information and data contained in this publication is up-to-date, correct and complete. Securities traded on the financial markets are subject to price fluctuations. A contract for difference (CFD) is also a financial instrument with leverage effect. Against this backdrop, CFD trading involves a high risk up to the point of total loss and may not be suitable for all investors. Therefore, make sure that you have fully understood all the correlating risks. If necessary, ask for independent advice. CFDs are complex instruments and are associated with the high risk of losing money quickly because of the leverage effect. 68% of retail investor accounts lose money trading CFD with this provider. You should consider whether you understand how CFD work and whether you can afford to take the high risk of losing your money.7

17.05.2023 – Golden times for the bulls in the platinum market: if the lobby group World Platinum Investment Council (WPIC) has its way, then a severe shortage of the precious metal is looming. Now such an assessment is not disinterested. Nevertheless, it may be correct. We illuminate the background.

Platinum did not come in the past months quite from the place. Only from February the price ran upward, here the daily chart. If the association is right, then there is more to come.

Source: Bernstein Bank GmbH

According to the WPIC, the world will experience one of the strongest deficits in the past five decades in the coming quarters. Demand remains robust, it said, and will exceed supply by 983,000 ounces this year. That would be the largest shortfall since the 1970s. As recently as March, the WPIC had warned of a shortfall of just 556,000 ounces.

China buys – South Africa supplies less
It added: “Opportunities for investors remain good for years to come, unless there is a collapse in demand or a substantial increase in supply, but both are unlikely. Demand from industry is expected to pick up by 17 percent year-on-year – mainly due to China’s glass and chemical industries, it said.
Meanwhile, the energy crisis in South Africa is slowing production, the WPIC judged. The country, after all, provides 70 percent of the supply. At the end of April, South Africa’s state-owned energy utility Eskom Holdings had again warned mining groups of a supply crisis. Ailing infrastructure, corruption and sabotage plague the country. High-quality coal is exported; South African power plants, on the other hand, receive low-quality coal that causes considerable damage. Impala Platinum Holdings Ltd. said weeks ago that the company expects output to fall.
Russia sanctions
Western sanctions against Russia also negatively impacted supply, the WPIC continued. All of this has caused a small flight into platinum ETFs, with Bloomberg reporting the strongest influx of capital since March 2019 in late April.
Platinum is valued for its electrical conductivity. It is resistant to water, air and certain acids. The white metal is used primarily in automotive catalytic converters, as well as in contacts in electrical engineering and electronics, and in hydrogen generators. It is also used in pacemakers and brain probes, as well as in dentistry. This is because it has the highest organ and body compatibility of all precious metals. And of course platinum is valued as jewelry and in coins and bars as a financial investment.

Our conclusion: We are curious to see whether the WPIC’s assessment is correct. And we are already wondering whether the government’s forced trend towards electric cars will not stifle the demand for platinum in catalytic converters as a mega-trend. Whether long or short – Bernstein Bank wishes successful trades and investments!

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The content of this publication is for general information purposes only. In this context, it is neither an individual investment recommendation or advice nor an offer to purchase or sell securities or other financial products. The content in question and all the information contained therein do not in any way replace individual investor- or investment-oriented advice. No reliable forecast or indication for the future is possible with respect to any presentation or information on the present or past performance of the relevant underlying assets. All information and data presented in this publication are based on reliable sources. However, Bernstein Bank does not guarantee that the information and data contained in this publication is up-to-date, correct and complete. Securities traded on the financial markets are subject to price fluctuations. A contract for difference (CFD) is also a financial instrument with leverage effect. Against this backdrop, CFD trading involves a high risk up to the point of total loss and may not be suitable for all investors. Therefore, make sure that you have fully understood all the correlating risks. If necessary, ask for independent advice. CFDs are complex instruments and are associated with the high risk of losing money quickly because of the leverage effect. 68% of retail investor accounts lose money trading CFD with this provider. You should consider whether you understand how CFD work and whether you can afford to take the high risk of losing your money.7

15.05.2023 – It looks like President Recep Tayyip Erdogan will remain in power. At any rate, according to the votes counted so far, he is leading ahead of his challenger Kemal Kilicdaroglu. However, he probably fell short of an absolute majority. A runoff election is likely. The Turkish lira is twitching nervously, and the downward trend continues.

The election has strengthened the downward trend of the lira, albeit still in small steps. Vola picked up compared to trading a week ago, as you can see in the hourly chart of USDTRY.

Source: Bernstein Bank GmbH

The trend lately has been: The old president is the new one. And with that, the destruction of the currency could continue. Because Erdogan believes that lower interest rates will eliminate inflation. They should signal that everything is fine and encourage investors to venture into new projects because credit is cheap.

More Erdoganomics
With Erdoganomics now looming further – low interest rates with hyper-inflation – many Turks are likely to move their money to safety. Gold, dollars, euros, just get out of the soft currency. And foreign investors are likely to think twice about setting up new companies in the country.
Because the future could be worse than feared. Interestingly, there is definitely dissatisfaction among voters. Erdogan’s party, the AKP, for example, probably suffered its worst result since its first election in 2002, with around 35 percent. But it still remains the strongest party. However, the social democratic CHP did not benefit from the losses.

Islam instead of Europe
Rather, voters turned to the radical right, further darkening the economic outlook. Thus, other parties in Erdogan’s alliance gained, such as the MHP. This party, according to the Federal Agency for Civic Education, promotes the idea of “Turkey as a regional power that should become the center of attraction for the Turkish and Islamic worlds.” The Islamist splinter party YRP also made gains.

The right-wingers will take their toll as majority procurers if Erdogan remains in power: For example, the Sharia-compliant marriage of children is being discussed. This is likely to further boost overpopulation in the future and put a strain on the social systems. But it does not necessarily make the country attractive for Western-oriented companies, and certainly not for female managers who have to fear for themselves and their families. Headscarves instead of cash flow, so to speak. This raises the question of whether Turkey belongs in Europe or whether it would be better to join the Arab League or a confederation with Iran or other wonderful countries.

Our conclusion: It will now be exciting again on May 28, when the runoff election is likely to be held. If the mood turns and a pro-Western president with a solid monetary policy is elected, there is hope for the Turkish lira. Otherwise, the currency will be a meal for the bears. We are curious how it will continue – Bernstein Bank wishes good luck!

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The content of this publication is for general information purposes only. In this context, it is neither an individual investment recommendation or advice nor an offer to purchase or sell securities or other financial products. The content in question and all the information contained therein do not in any way replace individual investor- or investment-oriented advice. No reliable forecast or indication for the future is possible with respect to any presentation or information on the present or past performance of the relevant underlying assets. All information and data presented in this publication are based on reliable sources. However, Bernstein Bank does not guarantee that the information and data contained in this publication is up-to-date, correct and complete. Securities traded on the financial markets are subject to price fluctuations. A contract for difference (CFD) is also a financial instrument with leverage effect. Against this backdrop, CFD trading involves a high risk up to the point of total loss and may not be suitable for all investors. Therefore, make sure that you have fully understood all the correlating risks. If necessary, ask for independent advice. CFDs are complex instruments and are associated with the high risk of losing money quickly because of the leverage effect. 68% of retail investor accounts lose money trading CFD with this provider. You should consider whether you understand how CFD work and whether you can afford to take the high risk of losing your money.7

12.05.2023 – Behind every strong man is a strong woman. Behind Elon Musk, there is probably Linda Yaccarino. The NBCUniversal manager could become the new head of Twitter. This would allow Musk to finally focus completely on Tesla – and hopefully soon get rid of a brake block on the tire.

Tesla bulls can use a little boost. In the short term, the share price has risen a little, here is the five-minute chart.

Source: Bernstein Bank GmbH

Tesla had largely met analysts’ expectations for the first quarter of 2023. However, the figures were not very impressive: net income slipped by 24 percent to 2.5 billion. At the same time, revenue climbed moderately from $23.21 billion to $23.33 billion.

A lot of work at Tesla
The automaker has some work to do: Tesla said the “underutilization of new factories” is melting margins, along with higher costs for raw materials, logistics and warranty costs. Demand is faltering, not least due to the sharp rise in electricity prices in the West. In addition, competition is growing steadily. Tesla has often failed to deliver on promises – the market is waiting for the cyber truck.

Fall from grace Twitter subsidy
Twitter remains one of Tesla’s biggest problems. Because around 23 billion dollars of the 44 billion needed for the Twitter purchase had been raised by Elon Musk by selling Tesla shares. This fall from grace has angered a lot of investors to this day: after all, anyone who invests money in the car business doesn’t need any disruptive fire from other companies. Given Elon Musk’s rather erratic nature, it’s quite possible that something like this will happen again, because Twitter might need further cross-subsidization.

No official confirmation yet
So yesterday Musk announced he had found a successor for himself at Twitter. She will take up her post at the social media network in around six weeks. Musk did not initially mention a name. According to the Wall Street Journal, however, it will be Linda Yaccarino. The manager is currently responsible for the global advertising business of the US media giant NBCUniversal. This is exactly where Twitter has had some problems since Musk took the liberty of freeing the twitter channel from left-wing censorship.
However, if you read the report carefully, you will notice that the WSJ writes that “talks” are ongoing with the manager – they are “in talks”. This means that the deal is not yet in the bag. If the manager still jumps out, then the current moderate recovery of Tesla should collapse.

However, if you read the report carefully, you will notice that the WSJ writes that “talks” are ongoing with the manager – they are “in talks”. This means that the deal is not yet in the bag. If the manager still jumps out, then the current moderate recovery of Tesla should collapse.
We think: Along with the cyber truck, a successful turnaround of Twitter could give Tesla stock new momentum. Conversely, a renewed looting of Tesla’s capital to prop up Twitter could further beat the stock down. Especially since operational problems need to be resolved. The drama is exciting all the same. So keep an eye on the real-time news. Whether long or short – Bernstein Bank wishes successful trades and investments!

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The content of this publication is for general information purposes only. In this context, it is neither an individual investment recommendation or advice nor an offer to purchase or sell securities or other financial products. The content in question and all the information contained therein do not in any way replace individual investor- or investment-oriented advice. No reliable forecast or indication for the future is possible with respect to any presentation or information on the present or past performance of the relevant underlying assets. All information and data presented in this publication are based on reliable sources. However, Bernstein Bank does not guarantee that the information and data contained in this publication is up-to-date, correct and complete. Securities traded on the financial markets are subject to price fluctuations. A contract for difference (CFD) is also a financial instrument with leverage effect. Against this backdrop, CFD trading involves a high risk up to the point of total loss and may not be suitable for all investors. Therefore, make sure that you have fully understood all the correlating risks. If necessary, ask for independent advice. CFDs are complex instruments and are associated with the high risk of losing money quickly because of the leverage effect. 68% of retail investor accounts lose money trading CFD with this provider. You should consider whether you understand how CFD work and whether you can afford to take the high risk of losing your money.7