News

On Monday, there were no important economic news. An escalation of protests in Hong Kong has strongly impacted the world’s markets. But there was nothing new on the Brexit and on the US-China trade deal. In this contexts, investors are switching to more secure assets.

GBP/USD day chart

After the weekend, the crypto market lost about 2%, reaching a capitalization of about $243 billion. There’s currently no positive driver that could push crypto prices up. In the US, the authorities are ever more skeptical about digital currencies, calling them the key payment method for terrorists. In this situation, most investors treat their crypto solely as a speculative instrument.

GBP/USD

GBP grew quite a lot on Monday after Nigel Farage stated that he won’t contest Conservative-held seats in the December 12 election. This improves the Conservatives’ prospects to win a majority and complete the Brexit. At the closing of the day’s session, the pound was trading at 1.2860 – a 0.7% increase since the opening.

GOLD

Gold’s downward trajectory that began in September is still confusing traders, but the trend is likely to be temporary. Gold has already grown by 14% since the beginning of the year. There are still lots of unsolved issued – from the US-China trade deal to the overdue global economic recession. Moreover, the large amount of liquidity coming from the US and EU central banks will be allocated among all the markets, including gold. For this reason, demand remains high. The price can still go back to $1500 and above per ounce.

INDICES

Most markets were trading in the red on Monday. Investors were nervous about the protests in Hong Kong and about the lack of news in the US-China trade talks. The signals about the industrial slowdown in the euro zone added to the general negativity. Only good news and positive macroeconomic data can trigger a new price rally.

What’s next?

11.30 UK: unemployment benefit requests data for October
12.00 EU: ZEW Institute indicator of economic sentiment for November

Important Notes on This Publication:

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.

11.11.2019 – Daily Report. Wait and see: Investors in Frankfurt are taking it easy at the beginning of the week. US President Donald Trump does not want a customs deal at any price. And the unrest in Hong Kong is causing additional nervousness.

Frankfurt resets

Slight decline at the beginning of the week: On a day with little news, the German benchmark index initially crumbled moderately. The DAX fell by 0.3 percent to 13,187 points. The indicator thus closed last Thursday’s price gap of 13,227 points. However, there remains another open gap of 12,200 points. That could be a possible celebration for the bears…

Spain bonds under pressure

After the election in Spain, investors initially parted with Spanish bonds – after the election this weekend, another hanging game in parliament threatens. The yield on ten-year bonds climbed to a three-and-a-half month high of 0.418 percent, according to “Börse Online”. The risk premium over comparable federal government securities thus climbed to its highest level for around five weeks.

Worry lines in the global economy

A message from the Ifo institute also caused a frown. The Munich-based institute stated that the mood in the global economy was worse than it had been since the crisis year of 2009. The corresponding indicator slipped to minus 18.8 points in the fourth quarter. In the previous quarter, it had been 10.1 points. The Institute surveyed 1,230 experts from 117 countries.

Trump slows down hope for China

A little tailwind from China and the USA would be welcome. But here Trump cooled down hopes. He complained about the speed of trade talks with China. The talks went ahead, “way too slow for me”. He went on to say that China in particular was interested in an agreement. However, he limited: “If it’s not a great deal, I won’t make it”.

Power struggle for the customs deal

One important background for your trades: In the White House there is apparently a power struggle raging between a faction that absolutely wants a deal with China and another faction that makes no concessions at all. Screen your regular market updates for Peter Navarro (Falke) and Larry Kudlow (Taube; Director of the National Economic Council). Whenever you hear a request to speak from one side, the free real-time prices could react accordingly.
Peter Navarro, a White House consultant and director of the National Trade Council, told National Public Radio on Friday that if punitive tariffs were eliminated, the pressure on Beijing would be reduced. Contrary to what China recently announced, there is no agreement to eliminate the tariffs – that is the decision of the US President alone. And lo and behold, shortly thereafter Trump put the brakes on hopes. No wonder that the yuan fell from around 6.97 to 7.01 against the dollar again.

Nervousness in Asia

Investors in Asia were disappointed with the recent developments. The Nikkei 225 dropped by around 0.3 percent to 23,331 points after its recent twelve-month high. In China, the CSI-300 slipped by a whopping 1.8 percent to 3,903 points. Investors were also concerned about the unrest in Hong Kong. On Monday morning, another person was shot by a policeman who escalated violence on the streets. Demonstrators blocked the subway and some streets, the police used tear gas. There is speculation about an impending general strike. Trump warned Beijing weeks ago of military intervention in the former British crown colony and linked the matter to the customs dispute. The Hang Seng in Hong Kong closed with a sizable minus of 2.6 percent at 26,927 points.

New record high in S&P 500

Previously, Wall Street had presented itself calmly on Friday. The Dow Jones made up for its losses in recent trading hours and closed virtually unchanged at 27,681 points. The Nasdaq Composite advanced 0.5 percent to 8,475 positions. And the S&P 500 even gained 0.3 percent to 3,093 points, once again marking a record high.

This is what the day brings

There are no really important dates for Monday. The US bond market remains closed.
As always, you will find an overview of all economic data here: Market Mover

If you trade CFD or online stocks, you will otherwise have to read all the news from the Bloomberg news agency about trumps – customs disputes, impeachment, election chances, the economy – with a good portion of skepticism. The founder of the news agency, Michael Bloomberg, entered the election campaign on the Democratic side and was once a Republican. After all, the stock market is now potentially getting a business-friendly alternative.
The Bernstein Bank wishes you successful trades!

Important Notes on This Publication:

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.

08.11.2019 – Daily Report. New caution after the record hunt: After the new records on Wall Street, the stock market is now taking it easier again. On the one hand, many brokers are making profits. On the other hand, new doubts about the conclusion of a customs agreement between Beijing and Washington are emerging.

Frankfurt resigns

Shortly before the weekend, many stock market participants played it safe on the German stock exchange – the DAX recently recorded a loss of 0.2 percent to 13,259 points. Now, the price gap of 13,227 points, which was torn yesterday, has come to the fore again. Yesterday, thanks to the prospect of a breakthrough between China and the USA, the German benchmark index reached its highest level since the beginning of 2018 at 13,301.

German exports surprise

Meanwhile, surprisingly positive news from German foreign trade supported prices: In September, exports rose by 1.5 percent compared to the previous month, according to the Federal Statistical Office. The most recent increase was in November 2017. As always, you can find the overview here: Market Mover

New doubts about customs deal

A media report on the customs dispute caused skepticism on the stock market. The US futures market declined and the yuan fell slightly. In the White House, there is supposed to be some strong internal resistance against a lifting of the US punitive tariffs against China, which were originally planned for 15 December. This was reported by the news agency Reuters. It is quite possible that new punctured internals will arrive on the weekend, shaking stocks, bonds and foreign exchange strongly at the beginning of next week. So nothing is safe except volatility – which doesn’t scare you when you trade CFDs.

Mixed Tendency in Asia

Furthermore, economic data from China had occupied the stock market this morning. The foreign trade figures were not quite as bad as many analysts had expected. In October, exports fell by 0.9 percent, imports even slipped 6.4 percent compared to the same period last year. The Chinese CSI-300 fell by 0.5 percent to 3,973 points. The Nikkei in Tokyo closed 0.3 percent higher at 23,392 points – the fifth consecutive week of gains. In the course of trading, the Nikkei had reached its highest level in 13 months.

Record hunting in New York

On Thursday, hopes of a gradual reduction in the trade war tariffs imposed by the US and China had set new records. This was accompanied by solid data from the U.S. labor market, with the number of first weekly applications for unemployment benefits falling slightly more than expected.
The Dow Jones Industrial closed with a plus of 0.7 percent to 27,674 points. The S&P 500 also posted a new final high, closing 0.3 percent higher at 3,085 points. The Nasdaq 100 achieved a plus of 0.3 percent to 8,220 points. Around two and a half hours after the start of trading, all three indices had reached record highs. Meanwhile, US bonds suffered under the new optimism: ten-year bonds fell to their lowest level since the end of July – yields rose for all maturities.

Swiss stock exchange at all-time high

A look at the Alpine republic remains: here, too, the stock exchange recorded a new record high in trading yesterday at 10,356 points. In the end, the SMI recorded a gain of 0.1 percent at 10,329 points. On Friday morning, however, the leading index was again down 0.3 percent at 10,297 points.

This is what the day brings

The appointment calendar is only sparsely filled at the end of the week.
At 4pm the US wholesale inventories for September are reported.
At the same time, the consumer confidence of the University of Michigan is published.
The Bernstein Bank wishes you successful trades and a relaxing weekend!

Important Notes on This Publication:

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.

On Thursday, the US markets updated their all-time highs yet again. Investors are so pleased with how the US-China trade talks are going that they are ready to take new risks. The removal of trade limitations opens up new prospects for two of the world’s largest economies.

Dow Jones Industrial daily chart

The crypto market has been calm today. Bitcoin isn’t going to break through the resistance line. The price is channeled between the 100-day and 200-day moving averages. The low trading volume in the flat market is pointing to strong price movements in the near future.

EUR/USD

For the fourth day in a row, euro is under pressure from sellers. Yet another attempt to remain above 1.1170 failed. The continuation of the trade negotiations between China and the US can push the pair into the local minimum zone at 1.0900 and scrap all the successes of October.

GOLD

On Thursday, gold has lost some of its recent gains and was trading at $1465 per ounce. The detente between US and China is pressuring the “save haven” asset and pushing investors to switch to riskier assets. Most probably, the current price of gold already takes into account the likely trade deal. The only thing that can contain the fall are purchases by the leading central banks, which might grab onto the opportunity to increase their reserves while the price is good./p>

INDICES

While the risk of a global trade war is abating, Germany still can’t put its industry in order. However, even a small decline in economic data gives investors a strong buy signal. They believe in the bright future and keep buying DAX.

What’s next?

05.00 China: annual imports and exports
15.30 Canada: employment data for October
17.00 US: Michigan State University consumer confidence index

Important Notes on This Publication:

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.

 

07.11.2019 – Daily Report. Finally China announces execution: The otherwise rather taciturn trade ministry in Beijing announces that customs duties on both sides are to be gradually dismantled – with which phase 1 can be signed. The breakthrough pushes US futures north. Which is why we can look forward to new records in floor trading. Once again the DAX climbs an annual summit.

US Futures and DAX pull up

The stock market in global trading celebrated the news from Beijing: the contract on the Dow Jones climbed by 135 points or half a percent, the future on the S&P 500 by 0.4 percent. The DAX climbed to 13,301 points, with the leading German index recently rising by 0.8 percent to 13,286 points. This means that the all-time high of 13,596 points is no longer too far away.

German industry weakens

The fact that German industry cut back production in September receded into the background. According to a report by the Federal Statistical Office, total production was 0.6 percent below the previous month’s level. Compared to the same month last year, production fell by a harsh 4.3 percent. All data can be found here: Market Mover

China announces breakthrough

The topic of the day was the customs dispute. According to the Chinese government, Washington and Beijing have agreed on a gradual reduction of the punitive tariffs imposed on each other. This agreement will be part of a first partial agreement, Gao Feng, spokesman of the Ministry of Commerce. The extent of the tariff reduction depends on the concrete content of the agreement, Gao added. The proportions of the cap would have to be the same on both sides. The agreement is to be signed within the next few weeks.

Oil prices also rising

The happy customer also pushed the oil market – the conclusion of a trade deal would increase the chances of the global economy picking up. WTI climbed 1.4 percent to 57.11 dollars, and Brent also rose 1.4 percent to 62.62 dollars. A factlet that speaks for an oil glut receded into the background. In September this year, for the first time in three decades, the USA exported more crude oil than it imported, as Oilprice.com reported. This is the first oil surplus since 1978.

Asia has not yet reacted

Customs news came too late for Asian trade. The Nikkei gained 0.1 percent to 23,330 points in Tokyo even before the announcement. The CSI-300 climbed 0.2 percent to 3,992 points. However, the renminbi strengthened against the dollar to 6.9879 points.
What a back and forth. Only yesterday Reuters had cooled the anticipation. According to this, a meeting between Presidents Donald Trump and Xi Jinping could be postponed until December, which would delay the conclusion of an interim deal. White House spokesman Judd Deere said there had been progress on the text of the Phase 1 agreement, which would be announced as soon as there was agreement on where to sign it.

Wait and see in New York

Accordingly, the Wall Street stock market had held back on Wednesday. The Dow Jones Industrial closed unchanged at 27,493 points. The S&P 500 recorded a minimal gain of 0.1 percent to 3,077 positions. The Nasdaq 100 lost 0.2 percent to 8,196 points.
The buying mood had also cooled down with the head of the Chicago Fed, Charles Evans. In an interview with Yahoo Finance, he said that the US economy probably did not need another interest rate hike, as it was proving to be quite robust.

This is what the day brings

The Pound Sterling will come into focus on Thursday as the Bank of England’s interest rate decision is scheduled for 1pm.
At 2:30pm the weekly first applications for unemployment assistance follow in the USA.
The Bernstein Bank wishes successful trades!

Important Notes on This Publication:

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.

On Wednesday, the stock market correction continued. Investors are still analysing the possible outcomes of the US-China trade talks, with a deal expected soon. As positive business activity data is reported in the US, a further relaxation of the monetary policy is becoming less probable. The markets are waiting for something new to spur them on.

USD index daily chart

The things are looking better in the cryptocurrency market. Starting from January 1, 2020, China will relinquish its harsh policy against crypto mining. The global market cap has grown by 2.8% to $253 billion. In the absence of important crypto news, traders are mostly busy speculating with their assets.

EUR/USD

Tuesday lacked significant news and economic reports, and euro was trading at 1.1070. Investors are disconcerted by the latest statement by Christine Lagarde, who could follow in the steps of Mario Draghi and lower the interest rate to a negative value. The correction that began two days ago has been expected for a while. Now, everything will depend on the European economical data and on the news of the US-China trade talks.

GOLD

Gold is trading within a narrow channel. The price now mostly depends on the outcome of the China-US negotiations. If a deal is indeed signed soon, the trade war will end, and the demand for risky assets will grow. Gold is a “safe haven” asset, so its price may undergo a correction.

INDICES

Global markets are poised in expectation. A lack of global news or economical data gives investors a chance to take a breath and consider their options. European exchanges are waiting for a decision on Brexit; those in the US are expecting a trade deal with China. Many investors will likely choose to take profit and wait for more news before they take their next step.

What’s next?

11.00 ECB monthly report
14.00 Bank of England’s inflation report
14.00 UK interest rate update

Important Notes on This Publication:

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.

06.11.2019 – Daily Report. But now it’s really time for a breather: After the close final records of Dow Jones and Nasdaq Composite, the DAX is now stagnating. Nevertheless, it is enough for a new high for the year. The same applies to the Nikkei. Once again, there is a lack of market-moving news. The stock exchange is waiting for execution of the China-USA customs deal.

Modest courage in Frankfurt

The German leading index was moderately optimistic in early Wednesday’s trading. The DAX crawled to a new high for the year of 13,181 and recently remained unchanged at 13.150 points. However, the free real-time prices on the trading platform hardly flashed at all. In addition to the reporting season, brokers in Frankfurt focused their attention on German economic data. However, the figures on sentiment among German purchasing managers and European retail sales did not really move prices. All data can be found here: Here is the overview: Market Mover

When’s the customs deal coming?

The number one issue in global trade remained the trade dispute between China and the USA. It is still unclear when or where US President Donald Trump will sign the agreement with President Xi Jinping. The market also hopes to cancel the new US tariffs announced on 15 December. Trump said both sides were looking for a location to fix the partial agreement, and Reuters said the signing could take place this month.

Beijing strengthens the Yuan

Meanwhile, China sent out a sign of good will on the currency market. The People’s Bank of China set the daily midpoint fix at 7.0080 against the dollar. According to CNBC, this was the highest price since August 8. The onshore yuan may float in a band of 2 percent above the fixing. Washington is likely to watch the move benevolently: The USA had accused China of devaluing the yuan in order to make exports cheaper – and thus circumvent the punitive tariffs. Only yesterday did the yuan cross the red line again at 7.

Mixed tendency in Asia

The Asian stock markets reacted differently to the latest developments in the morning. The Nikkei 225 reached an annual high in early trading and closed 0.2 percent higher at 23,304 points. The weaker yen supported prices. Meanwhile, the Chinese CSI-300 with the most important red chips dropped 0.5 percent to 3,985 points in the morning.

New records set in New York

Investors in New York were also initially optimistic the night before. Both the Dow Jones Industrial and the Nasdaq 100 and Nasdaq Composite reached new highs on Tuesday.
The Dow rose to 27,560 points, and entered the closing bell with a new closing record of 0.1 percent at 27,493 points. The Nasdaq Composite squeezed out a minimal gain of 1.48 points and closed at around 8,435 points – the second final high in a row. The Nasdaq 100 had climbed to 8,229 points in the course of trading, but had to end trading 0.01 percent down at 8,210 points. The S&P 500 crumbled by 0.1 percent to 3,075 points. In addition to the optimism regarding the customs dispute, the data from the US service sector delighted the stock market.

Anticipation of US bonds

This also applies to treasuries: the yield of 10-year-olds rose by six basis points to 1.787 per cent, the largest increase in three weeks. The 2-year note gained 3.2 points to 1.594 percent. And the 30-year bond gained 6.2 basis points to 2.274 percent – again the highest daily gain in three weeks.

Repocalypse puzzle solved

Meanwhile an interesting news about Credit Crunch has arrived from the end of September. According to a Financial Times report, the culprit was JPMorgan. The bank went out of cash and invested massively in long-dated US bonds – a total of 130 billion dollars is said to have flowed out. The bond portfolio increased by 50 percent, while loans were reduced. The reason: loans granted are considered riskier than government bonds. And that’s why the G-SIB surcharge is rising, so JPMorgan has to hold back more cash reserves (G-SIB: Global Systemically Important Bank). But JPMorgan in particular has very little cash leeway because of dividends and share buybacks. We are curious to see whether this really was the sole reason for the freeze in the interbank market.

This is what the day brings

The view remains on a rather thinly filled daily calendar.
US productivity in the third quarter is due at 2:30pm.
At 4:30pm the weekly crude oil inventory data is reported to the state Energy Information Administration.
The Bernstein Bank wishes you successful trades!

Important Notes on This Publication:

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.

After the rally on the US markets, investors finally got a respite on Tuesday. According to the Wall Street Journal, the Chinese and American negotiators are considering compromise options to sign a trade agreement. A total of $112 billion worth of tariffs could be canceled. The market feels overheated by all this news and needs to wait for more serious decisions to continue its upward movement. What are the reasons for the loss of the euro on Tuesday?

EUR/USD day chart

The crypto market is demonstrating cautious growth. In the past 24 hours, BTC trading volumes grew by 7%. Normally an increase in price and volume spurs on crypto enthusiasts and points to a bullish mood. However, recently such price fluctuations have been associated with market manipulations by whales. With the latest cryptocurrency news being generally positive, the road to new year highs lies open.

EUR/USD

Euro slumped on Tuesday – possibly because the new ECB head Christine Lagarde’s criticism of the German economy made traders change their plans. Growth in the euro zone is hurdled by the German economy; in turn, Germany isn’t happy with the ECB policy and the low interest rates that don’t leave enough German investors enough room for manoeuvre. After the positive data on the US non-manufacturing business activity for October, euro is trading at 1.1070 – the lowest point for the past week.

GOLD

Wall Street players keep nudging the market towards a new record high, ignoring the current geopolitical issues, trade wars, and recession risks. The current gold price movements seem completely illogical: indeed, it should normally fall when stock prices rise. With time, investors will find their way around the forming anomaly of the gold and stock prices growing simultaneously. Meanwhile, on Tuesday gold got corrected to below $1500 per ounce.

INDICES

Tuesday was a day of rest for the stock market. Global indices were all in the green, but no significant growth followed. All attention is still focused on the expected US-China trade deal. Christmas and Lunar New Year are getting closer, and the politicians would like to resolve their differences before the holiday season kicks in. The US debt has reached the $23 trillion mark for the first time, while the federal budget deficit has almost reached $1 trillion. A new recession could be around the corner.

What’s next?

09.00 Germany: industrial orders for September
17.00 Canada: business activity index
17.30 US crude oil supplies

Important Notes on This Publication:

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.

05.11.2019 – Daily Report. The US indices have once again set new records. In early trading, the DAX almost managed to reach an annual high again. Market moving news was sparsely sown.

Restless upwards

The DAX actually deserved a break: on Monday, the German benchmark index had dropped out of trading at its highest level for a year and a half, 13,136 points. The indicator had reached 13,166 over the course of the year. Most recently, the German benchmark index was again 0.1 percent firmer at 13,154 points. Not much is missing from the all-time high, the 13,596 points from January 2018 are a good 3 percent above the current level.

Customs hope again and again

Once again, investors analyzed news on the customs dispute. First, the Wall Street Journal reported, citing a high-ranking representative of the US government, that Beijing and Washington could withdraw some of the most recently introduced tariffs under a partial agreement.
The Financial Times also reported that US politicians were considering cancelling 112 billion dollars worth of tariffs on goods as a concession for Phase 1. Penalty duties of 15 percent on goods such as clothing and computer monitors were introduced on September 1. In return, the US demanded stronger protection for the intellectual property of US companies. Meanwhile, Chinese President Xi Jinping promised steps to open the domestic market to foreign investors at a trade show.

Brokers in Asia are accessing the market

The Chinese CSI-300 reacted with a spurt above the 4,000 mark and closed 0.6 percent higher at 4,003 points. The Nikkei 225 rose after the holiday break by 1.8 percent to 23,216 points.

Boom in New York

The night before, the record hunt on Wall Street had continued. What did investors care about, given yesterday’s news about the customs deal, that US industry orders fell more than expected in September?
Now the Dow Jones also reached a new high, closing with a gain of 0.4 per cent to 27,462 points. The S&P 500 rose a further 0.4 percent to 3,078 points. And the Nasdaq 100 climbed the high by 0.6 percent to 8,211 points. By the way, all the major US indices ripped a small upward gap with yesterday’s move. Wall Street is otherwise a carefree country, as a glance at the VIX shows: The fear indicator recently remained just under 13 points – a level from which it rose steeply last July after several attempts.

Oil warning from OPEC

Meanwhile, the oil cartel OPEC sent a bearish request to speak to the oil market. In the annual World Oil Outlook (WOO), OPEC lowered its growth estimate from 1.4 million barrels per day in 2018 to 0.5 million barrels by the end of the next decade. Otherwise, the organization described the past twelve months as a challenge. However, the question arises as to how valid an estimate that extends several years into the future is.

This is what the day brings

In the afternoon some potentially market moving dates are scheduled.
First, the U.S. trade balance for September will be in at 2:30pm.
Shortly thereafter at 3:45pm the Markit PMI Service for October will follow.
And at 4pm the ISM index Services 10/19 is reported.
As always, you will find the overview here: Market Mover
The Bernstein Bank wishes you successful trades!

Important Notes on This Publication:

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.

This week isn’t expected to bring much in terms of important news. Since no significant financial stats are to be released, economic news will act as key behavioral drivers for traders. US companies’ good performance, a new interest rate reduction by the Fed, news on the successful conclusion of the first round of the US-China trade talks – all this pushing investors to take higher risks.

Dow Jones Industrial Average

Bitcoin, together with most other cryptocurrencies, hasn’t shown any major movement. Its price remained below $10k, having grown by about 1% on Monday. The daily trading volume of about $25 billion was within the average range, too. Major speculators will probably use this moment to manipulate the market and extract as much profit as possible. Rapid price fluctuations in both directions are possible.

EUR/USD

On Monday, investors partially took their EUR/USD profits. A new attempt to break through the 1.1180 resistance line failed. German economy is putting pressure on the euro; it can’t seem to get out of the recession, with the business activity stats for October still at a 10-year low – though higher than predicted earlier.

GOLD

Many investors are surprised that gold still hasn’t fallen below $1500 per ounce. Considering that the US stock market prices are at the all-time high, gold should have lost its attractiveness. Perhaps the reason is not that gold is strong but that the US dollar is weak. Since this week is devoid of important economic stats, investors’ attention will be focused on the global political news.

INDICES

On Monday, tech stocks pushed the three key Wall Street indices to new highs. Secretary of Commerce Wilbur Ross stated that US companies will soon be able to obtain licenses to trade with Huawei. Investors are convinced that improved trade relations with China will spur the economy and help avoid a recession.

What’s next?

05.30 Reserve Bank of Australia’s decision on the interest rate
11.30 UK services business activity index for October
17.00 US non-manufacturing business activity index for October

Important Notes on This Publication:

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.