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10.09.2019 – Daily report. Just don’t get caught on the wrong foot. Because on Thursday the European Central Bank will be speaking. In addition, bad data from China is slowing the buying mood. Global trade is therefore waiting. The shareholders in Frankfurt are also holding back.

Caution in Frankfurt

This day should be rather quiet, as long as there are no unexpected requests to speak from politicians – e.g. about Brexit or the China/USA customs dispute. For the decisive topic was the upcoming ECB meeting, or rather waiting for it. Most investors are sure that the central bank will lower the interest rate for deposits with the central bank on Thursday. However, it is unclear how big the move will be and whether ECB boss Mario Draghi will also announce a resumption of security purchases. The DAX thus fell by 0.3 percent to 12,196 points in early trading.

Focus on automotive stocks

Meanwhile, investors’ attention was focused on automotive stocks and on Frankfurt, where the IAA will start with the press day. You should expect this in the coming days in the German mass media: glowing reports about fantastic electric cars and critical comments about the fact that the German car industry is simply not changing fast enough. We will see it in the interest shown at the IAA and in the sales figures. Of course, the e-strategy will have an impact on stock prices.

Dampers from China

Meanwhile, scepticism on the stock markets was fuelled by figures from Chinese industry, which had to make the biggest price cuts in three years in August. According to the statistics office in Beijing, producer prices shrank by 0.8 percent compared to the same month last year. Demand is therefore falling. The same picture was seen for cars, with sales stagnating in August.
As always, you can find an overview of all the data here: Market Mover
As a result, the CSI-300 in China fell by 0.4 percent to 3,956 points. A small report regarding the customs dispute was hardly noticed: Huawei Technologies withdrew its lawsuit against the US government for confiscation of equipment. In Japan, on the other hand, the Nikkei closed with a plus of 0.4 percent at 21,392 points.

Waiting in New York

Wall Street, too, had presented itself inconsistently the evening before. The Dow Jones closed 0.1 percent higher at 26,835 points. The S&P 500 left virtually unchanged at 2,978 points. And the Nasdaq Composite fell 0.2 percent to 8,087 points.

Break from Brexit Theatre

In Great Britain, the forced break of parliament will initially bring some peace and quiet to the Brexit Theater. Queen Elisabeth II enacted the law which obliges Prime Minister Boris Johnson to request a three-month postponement of the Brexit until the end of January if he does not reach a resignation agreement by 19 October. But Johnson wants to lead his country out of the EU at the end of October as planned, if necessary, even without an agreement. The British Parliament has also rejected Johnson’s request for new elections for the second time in a week. Now even the last voter on the island must have understood that the political functionaries in the parliament are not interested in the will of the people.

What is also stupid about the British voter: what country, still in a state of consolation, would risk leaving the world’s largest trade union and going it alone? Which state, relying on its own strength, would say goodbye to a political bloc that is milking it financially and imposing laws on it that do not suit it? Right: The United States of America in 1776. We quoted from a letter to the editor in an English newspaper. Otherwise, the opposition is likely to form during the five-week break, so keep an eye on the British pound situation on your trading platform.

This is what the day brings

Silently the lake rests on this Tuesday. There are no important big dates in the calendar, which speaks for a quiet trade. But even with small movements you can make good profits thanks to the leverage with CFD – even in small niches of the market.
At best the JOLTS data to the job offers in the USA could interest the Wall Street or the forex trade at 16.00 o’clock.

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.

09.09.2019 – Daily report. New Week, Same Game: Investors Hope for a Settlement in the China-USA Customs Dispute. And a further easing of monetary policy by the European Central Bank (ECB). Of course, the Federal Reserve will have to follow suit next week. So the level of fresh money is rising, which is raising stock prices.

Slight plus on the German stock exchange

The DAX also continued to climb moderately at the beginning of the week: on Monday morning it was 0.3 percent higher at 12,225 points. Since its interim low of 11,267 points in August, the DAX has thus gained almost 1,000 points.

Capital flood ahead

Cheap money is just addictive for more – shares as material assets are just like raw materials an insurance against the destruction of the intrinsic value of paper money. Most investors expect a further reduction in the penalty rate (currently: minus 0.4 percent) that banks have to pay for deposits with the central bank for the ECB Council meeting on Thursday. However, it remains to be seen whether the bond purchases will be continued – the central bank is apparently resisting the move.

It is also a foregone conclusion that the Federal Reserve will cut the key interest rate by 0.25 percentage points in the coming week. This applies not only to Frankfurt, but also to global trade. But beware: if hopes are disappointed, things will quickly go downhill. But if you trade CFD, it won’t scare you because you can go short.

Skid marks from the customs dispute

Investors in Asia also continued to expect an oversupply of liquidity at the beginning of the week. In the People’s Republic of China, the CSI-300 rose by 0.6 percent to 3,973 points. In Tokyo, the Nikkei 225 closed with a plus of 0.6 percent to 21,318 points – after all, this is the highest level since the beginning of August.

And this despite the fact that the tariff dispute is damaging the Asian economy: Imports to China fell sharply in August. Exports also declined, especially to the USA. Investors’ calculations: the government must intervene with stimuli and the Chinese central bank must ensure lower interest rates. Meanwhile, the trade conflict is also affecting the Japanese economy: Gross domestic product (GDP) rose by only 1.3 percent between April and June, projected for the year as a whole – according to preliminary figures, growth should be 1.8 percent. As always, you can find all the data here: Market Mover

New York looks at the Fed

Investors on Wall Street focused on their central bank on Friday. The Dow closed trading up 0.3 percent at 26,797 points. The weekly plus was thus 1.5 percent. The S&P 500 rose by 0.1 percent to 2,979 points on Friday. In contrast, the Nasdaq 100 fell by 0.1 percent to 7,852 points.
Fed Chairman Jerome Powell had said at a conference in Switzerland that the US Federal Reserve was observing a number of uncertainties, including trade conflicts. The Federal Reserve would “react appropriately to maintain growth”. But he also said: “The US economy is in good shape” and “the Fed is not forecasting a recession”. The latest data were as contradictory as these statements: Outside agriculture, 130,000 jobs were created in the US in August, slightly less than expected. However, wages rose slightly more than expected.

New Brexit capers

Meanwhile, the British pound could be exciting again – so be sure to keep an eye on your trading platform with the regular market updates. According to the Daily Telegraph, British Prime Minister Boris Johnson is working to prevent the Brexit shift Parliament is striving for. And this is how it works: Johnson would adhere to the law drafted by Parliament and ask the EU to postpone the date of departure. At the same time, however, he would explain in a letter that the government is against postponing the date beyond 31 October. According to ITV television, the opposition wants to request an urgent debate in parliament today. The government is to be forced to publish its plans for a Brexit without an agreement.
By the way, the matter becomes really turbulent when a case occurs that nobody is expecting yet: If the Queen does not agree to the postponement law passed by the House of Commons and the Lords, it will not come into force. Smile and wave and delay could also cause a stir. A strong volatility of the British pound would then be expected. If you read these lines, you will certainly know more about the Queen’s verdict.

And this is what the day brings

There are only a few important dates on Monday. One of them is consumer credit in the USA in July, which is reported at 9 pm.

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.

09.09.2019 – Special report. Everything is so harmonious again on the stock exchange: Customs negotiations between China and the USA are to continue in October. Closely related: The Federal Reserve, the Chinese central bank and also the European Central Bank will probably loosen monetary policy further in order to avert a recession. According to experts, it is precisely this approach and the resulting negative interest rate that are a real cause for concern. Reason enough to deal with the dangers slumbering in the background.

End game for paper money

This better not end badly: The devaluation of the money continues, believes the Chief Investment Officer of Blackrock, Rick Rieder. In the fight against deflation, the central banks would have to keep pushing down interest rates. The expert recently cited long-term, unstoppable developments on his blog as the reason for the scenario of the financial “endgame”.
Inflation, for example, peaked in 1979. Firstly, the baby boom had abated since then; secondly, the growth in women’s employment had fallen afterwards. Thirdly, Deng Xiaping had initiated globalisation with his reforms in China. We add: China has become the workbench of the world, and the entry of India and Russia into the world market has also significantly lowered the prices of many goods. And finally, according to Rieder, with the Iranian revolution, the inflation fueled by the oil price has disappeared – especially since OPEC committed itself to a reasonable price policy. Furthermore, new technologies such as the Internet and smartphones would have led to greater price transparency – ergo at falling prices, because consumers would be able to compare better.

No inflation, nowhere

Although major central banks used ever larger weapons in the fight against deflation, they appeared unsuccessful in their attempt to raise inflation to a mostly desired level of 2 per cent, the Blackrock CIO continued. With key interest rates falling, the supply of bonds with negative interest rates is increasing; quantitative easing has worked its way up from government bonds to corporate loans. The end game is currency devaluation, i.e. a “debase” – the growth of liquidity must exceed the growth in global gross domestic product. Turning away from such an extreme policy is very difficult, as the temptation of fiscal policy to take on new debts is on the rise. The devaluation spiral in interest rates also increases the risk of an open currency war, the expert commented.
The countermeasure for investors: Assets that retain their intrinsic value and cannot be printed. Ergo: stocks, real estate and commodities, such as gold. The worst alternative: government bonds with negative yields and cash, since both can theoretically be offered indefinitely.

Bankers warn against negative interest rates

In fact, top bankers are now also warning against the negative interest rate. The ECB’s move has led to an “absurd situation” in which banks no longer hold deposits, the head of the Swiss UBS, Sergio Ermotti, recently raged. This policy is damaging social systems and savings rates.

Christian Sewing, head of Deutsche Bank, also warned that further easing by the ECB would cause serious side effects. In the long run, negative interest rates will ruin the financial system, even though a new interest rate step will make refinancing easier for states, he said at an event of the “Handelsblatt” according to Bloomberg. Sewing also warned of a further split in society, as savers would be penalised – already paying 160 billion euros for negative interest rates – while share prices rose. Moreover, the central banks had hardly any tools left in their hands to effectively counter a crisis in the real economy.

The next big short

And even if the flood of money raises stock prices – this effect also harbours dangers. At least Michael Burry warned of this – and he can well estimate the possible disaster to come, as he was right a decade ago in the financial crisis. Burry went down in the annals with the book “The Big Short”. Recently Burry spoke extensively on “Bloomberg News”. His theses: Central banks distort the market, passive investments create the next bubble.
The recent flood of money in the direction of index funds has parallels with the bubble of collateralized debt obligations before 2008. Index funds are currently pumping up the prices of equities and bonds, just as the demand for CDOs had caused a pull in subprime mortgages a decade ago. In the case of CDOs, pricing in the market was not based on a fundamental analysis of collateral, but on massive capital flows that followed risk assessment methods that Nobel Prize winners found to be good, but which ultimately turned out to be wrong.
“The dirty secret of passive index funds (…) is the distribution of the dollar value traded daily among the securities within the index,” Burry said. And: The flow of money will be reversed at some point. As with all bubbles, “the longer it takes, the worse the crash will be.

Here you will find protection

Burry, who currently manages about $340 million at Scion Asset Management in Cupertino, California, also had concrete advice for investors. He added that he likes small caps – which are underrepresented in passively managed funds and thus undervalued. In Japan, for example, there are many undervalued small companies with high cash or equity cushions. Another concrete tip: In Japan, the large exchange-traded funds in particular are better protected against global panic than other funds, as the Japanese central bank is particularly heavily invested in large ETFs.
No matter whether you trade CFDs or trade stocks online – you should definitely keep an eye on the issue of money devaluation by the central banks. The flood of “fiat money” has concrete consequences for commodities, bonds and equities if the bubble really bursts.

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.

06.09.2019 – Daily report. Joy in global trade: Customs negotiations between the USA and China are to continue in October. The news from the previous day will also have an effect on the Asian stock markets on Friday. However, investors in Frankfurt are keeping their powder dry before the important US job data in the afternoon.

DAX slightly up

Now the sun is shining vainly again: After yesterday’s confirmation of new customs negotiations by the Chinese administration, the world looks much better again. The DAX rose by 0.3 percent to 12,168 points by Friday midday, thus remaining above the 50-day line. Yesterday, the indicator climbed by 0.9 percent to 12,127 points – the highest level for five weeks. Germany’s leading index thus gained around 600 points within nine days.

The investors, who had become brave again, also quickly got a new bad news from the German industry: In July, German production surprisingly shrank by 0.6 percent. All important data can be found here: Market Mover

Joy in Asia

The prospect of a settlement in the trade dispute also pleased the Asian stock market. In China, the CSI-300 gained 0.6 percent to 3,949 points. In Japan, the Nikkei 225 took its leave with a plus of 0.5 percent at around 21,200 points into the weekend – the weekly plus thus amounts to 2.4 percent. No miracle, because yesterday also an Insider from China in things customs controversy hoping added: Hu Xijin, editor-in-chief of the state “Global Times” twittered that there were now more opportunities for a breakthrough in customs talks. The journalist is regarded as the mouthpiece of the Communist Party.

Profits in New York

Ergo also applauded Wall Street. The Dow Jones gained 1.4 percent to 26,728 points – in the course of trading, the leading US index passed the 26,800 mark for the first time in over a month. The S&P 500 rose by 1.3 percent to 2,976 places, the Nasdaq 100 climbed by 1.9 percent to 7,863 points. All major US indices have now left the sideways range and jumped above the 50-day moving average.

Yesterday’s strong ADP report was also a source of joy. According to the labor market service provider, the private sector in the United States had created more jobs in August than had been hoped for. Furthermore, the US industry showed strength with its order data in July and the mood in the service sector brightened surprisingly strongly in August. In the new optimism, gold and silver were less in demand again.

Focus on Fed and labor market report

Only a few important dates are on the list today. It gets exciting at 2.30 p.m. when the US Labour Market Report for August is shown on the screens of your trading platform.
The job data will also be of interest to the Federal Reserve. It will decide on possible rate cuts on September 18. Perhaps Fed Chairman Jerome Powell will be carried away by a commentary in the evening. He is taking part in the conference “The Economic Outlook and Monetary Policy” in Switzerland, which starts at 6.30 pm. According to the Wall Street Journal, the Fed is likely to cut interest rates by 25 basis points in two weeks’ time. Let’s wait and see.
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.

05.09.2019 – Daily report. New optimism on the Frankfurt scene: A trade war between the Middle Kingdom and the USA seems to have been averted. These are at least the latest signals that Beijing has just sent out. Moreover, the signs in Italy and Great Britain are no longer pointing to a storm. Even German industry has not stopped buying.

Profits on the German Stock Exchange

The shareholders in Frankfurt are once again taking action: a tame government in Rome that does not cause Brussels any trouble; defeats for the Brexit hardliners in London; and, above all, signals of relaxation from China in the customs dispute with the USA caused a buying mood early on Thursday. The DAX climbed 0.8 percent to 12,126 points. Even poor figures for German industry did not stop the trend: the order volume in July fell by 5.6 percent compared to the previous year, according to the Federal Statistical Office.

No (chaotic) Brexit

The focus on the British pound continued to be on the currency market. The gloating German media celebrated the events in London – many brokers were supposedly pleased that there was now no chaotic Brexit. The planned law against unregulated EU withdrawal is intended to force Prime Minister Boris Johnson to apply for a three-month extension of the deadline of 31 October if no agreement with the EU has been ratified by 19 October. In fact, the egg dance around the Brexit is now likely to drag on indefinitely because of the parliamentary revolt. Because Brussels can rely on the opposition in London to back down a hard negotiating line of the UK government. The Eurocrats only have to sit back with this Parliament and do nothing at all to undermine the Brexit. Not only will there probably be no chaotic Brexit, there will probably be no Brexit at all.
De facto, a small, elitist British caste of officials has ignored the will of its own people and handed Britain over to Brussels. And as expected, MEPs did not have the courage to face the voters’ verdict again because they did not want to lose their benefices – new elections are off the table. Or is it not? If Johnson asks the vote of confidence and loses it, a new election will be held. Then Labour will be destroyed if the recent polls hold true. So surprises are always possible on this issue – when you trade CFDs you should always keep an eye on your regular market updates.

Hope for Customs Agreements

The most important issue for shareholders was once again the customs dispute between China and the USA. According to the Chinese state television channel CCTV, new direct talks between the chief negotiators of the USA and China are to take place in Washington at the beginning of October as part of the regular strategic economic and trade dialogue between the two countries. More importantly, “significant progress” at the working level is to be prepared by mid-September.
The Chinese Ministry of Commerce confirmed on Thursday that there will be a meeting at the beginning of October, which will be attended by high-ranking officials. The decision had been made in a telephone conversation between Chinese Deputy Prime Minister Liu He and US Secretary of the Treasury Steven Mnuchin as well as US Trade Representative Robert Lighthizer. Also in attendance were Trade Minister Zhong Shan, the Governor of the Chinese Central Bank, Yi Gang and Ning Jizhe, Deputy Head of the National Commission for Development and Reform. So the Chinese are obviously serious.

Asia predominantly stronger

Ergo, investors in Asia seized the opportunity. They were also hoping for new stimuli in the People’s Republic – the otherwise rather powerless Council of State had just spoken out in favour of the “timely” use of several instruments to support the economy. The Council of State is the executive authority of the National People’s Congress, that is the inflated illusory parliament, which may meet once a year. But if the apparatchiks are allowed to announce this in public, the plans of the leader Xi Jinping are probably already in the drawer. The Chinese CSI-300 increased by 1 percent to 3,925 positions.
In Japan, the leading index Nikkei 225 closed with strong gains of 2.1 percent to 21,085.94 points. But: The Hang Seng, which had climbed by almost 4 percent the previous day and recorded the largest daily gain since 2011, slipped by 0.9 percent to 26,291 points. Despite the withdrawal of the extradition law, the demonstrations continued for the time being.

Winnings in New York

Investors on Wall Street had reacted hopefully to the turnaround in Hong Kong the night before: Head of government Carrie Lam withdrew the law on extradition to Red China. And this is also an issue in the customs negotiations: Donald Trump demanded a “humane attitude” from Beijing regarding the situation in the special administrative zone. The leading Dow Jones index closed the day 0.9 percent firmer at 26,355 points and almost at its daily high. The S&P 500 even rose by 1.1 percent to 2,938 points. And the Nasdaq 100 gained 1.4 percent to 7,719 points.

This is what the day brings

The calendar today contains some important events. As always, you will find an overview here: Market Mover
ADP’s employment figures for August start at 2.15 pm.
At 14.30, the first weekly applications for unemployment benefits will follow.
Further at 15.45 the Markit purchasing manager index for services is reported in August.
Shortly thereafter, at 16:00, the industry’s new orders in July will be reported via the ticker.
At the same time, the ISM Services index for August is reported.
At 17.00 finally the Energy Information Agency reports the storage quantities of crude oil.
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.

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!

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.

03.09.2019 – Daily report. Skepticism on the Frankfurt floor. Investors are reluctant to trade early on Tuesdays. The new negative factors are the old ones: China, USA, Great Britain. In other words, the threat of a trade war and Brexit. Gold continues its flight of fancy.

DAX sideways – Euro weak – Gold firm

That was probably nothing: The DAX tried to push up to 12.00 points in early trading, but bounced back at 11,980 points. Germany’s leading index recently dropped by 0.2 percent to 11,933 points. US futures also fell slightly. There were enough reasons for the reluctance to buy on the stock market: new fears in the China-USA customs dispute and the Brexit also stood out. The euro was again under pressure on the currency market, slipping to USD 1.0931, its lowest level since May 2017. Investors were looking for the safe haven of gold: the gold price in euros continued to swing below its recent record high of EUR 1,401.

Does Trump command the China exit?

Speculation about a government decree has intensified in the Anglo-Saxon media. Does Donald Trump want to get American companies out of China by presidential order? In fact, on 23 August Trump had for the first time called on American companies via Twitter to immediately look for alternatives for China and instead have products manufactured in the USA.

The POTUS (President of the United States) quoted the International Emergency Economic Powers Act (IEEPA). The Act was passed in 1977 and gives the President the authority to act on any unusual and extraordinary threat to the national security, foreign policy or economy of the United States (“any unusual and extraordinary threat … to the national security, foreign policy, or economy of the United States”). Needless to say, such an exit decree would mean a new stage of escalation in the dispute with China – and Wall Street would be swirling around.

No impetus from overseas

Meanwhile, the Beijing government took the floor, complaining that the recent US import tariffs violated the agreement China and the US had reached at the G20 summit in Osaka. The Chinese CSI-300 gained 0.1 percent to 3,854 points this morning. In Tokyo, the leading Nikkei 225 index closed almost unchanged at 20,625 points. There were no impulses from the USA. On Monday Wall Street was closed due to “Labor Day”.

Showdown in London

It was really exciting last time in Great Britain. The British pound slid below 1.20 against the dollar, its lowest level since October 2016. No wonder the dispute over the Brexit escalated: The opposition and around 20 rebels from the conservative government faction want to force Prime Minister Boris Johnson by law to give in to his tough Brexit course. The retainers want a delay of three months – and apparently in a salami tactic they want to sabotage the Brexit. The farewell has already been approved by a referendum and the victory of the Pro-Brexit-Tories in the parliamentary elections. The Prime Minister “under no circumstances” wants a further extension of the EU withdrawal deadline beyond 31 October. Johnson threatened to call new elections if he was defeated in the House of Commons.

US oil industry threatens collapse

And the US oil market is also going to be in trouble. According to the Wall Street Journal (WSJ), the Shale Revolution could come to an unpleasant end. Because a wave of bankruptcies is rolling over the American oil and gas industry. According to the WSJ, 26 companies have already filed for bankruptcy in 2019 and 28 in 2018. Small and medium-sized producers in particular are struggling with a lower oil price and the reluctance of financiers, many companies can no longer service their debts. In addition, OPEC is likely to do everything in its power to kill off its unloved competitors with high production and low prices.

This is what the day brings

As you can see, global politics continues to set the pace on the floor. In the recent reluctance to act, it was neither right nor wrong. The return was only right when you trade CFDs. But please only with a broker with a Bafin license.
If there is hope that the upcoming economic data will bring more movement, you will find the overview here as always: Market Mover
In the USA the Markit PMI manufacturing industry is scheduled for August at 3:45pm.
The ISM manufacturing index will follow at 4:00pm for August.
At the same time, US construction investments for July will be listed on the ticker.

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.

02.09.2019 – Daily report. No impetus on the German stock exchange. No wonder: Wall Street remains closed on Monday because of Labor Day. In addition, new punitive tariffs from the USA and China have come into force. On the economic side, there are no particularly important dates on the horizon. The beginning of the week is therefore maucous and directionless.

Minimal profit in Frankfurt

At the beginning of the week, there was little demand for shares on the German stock exchange. Many stock market participants leaned back, checked their real-time prices only rarely and otherwise kept an eye on the regular market updates on the trading platform. In early trading, the DAX tripped by 0.1 percent to 11,948 points. And what about the state elections in the East? Not an issue. Apart from the fact, of course, that green-left dwarf parties are now coming to power, even though voters have given a right-wing conservative bourgeois bloc a clear majority for power. If politicians do not listen to their voters, who demand a stronger economic policy focus with the promotion of domestic industries, but not ecological world rescue experiments, then this can also take its toll on the stock market.

New punitive tariffs

The main topic, of course, remained once again the American-Chinese customs dispute. New punitive tariffs came into force on both sides this weekend. On the one hand, the Trump administration imposed new customs duties on Chinese goods worth 112 billion dollars. China, for its part, countered, albeit with smaller calibres – US goods worth 75 billion dollars are now subject to special duties. Beijing picked out industries from the republican heartland in the Midwest and South. US President Donald Trump again called on American companies to look for suppliers outside China. However, as there is apparently still a willingness to talk on both sides, investors have been relatively relaxed recently.

Asia stock markets in the plus zone

Meanwhile, economic data from China has been providing a buying mood. The purchasing managers’ index calculated by the business magazine “Caixin” surprisingly rose to 50.4 points in August, indicating an expansion. The index primarily tracks sentiment in small and medium-sized companies. However, the situation is different for large and state-owned industrial companies. This index fell further in August to 49.5 points, as the Chinese statistics authority announced at the weekend. As always, you will find an overview here: Market Mover
Otherwise, the demonstrations in Hong Kong continued to weigh on people’s minds. In the People’s Republic, the CSI-300 nevertheless increased by 1.3 percent to 3,848 positions. Brokers were pleased with the government’s announcement of new economic stimulus packages. Plans include infrastructure projects and the opening of the financial market. The Nikkei 225 closed with a moderate minus of 0.4 percent at 20,620 points.

Caution in New York

Investors in the US had also been cautious about Friday. The Dow Jones saved a plus of 0.2 percent to 6,403 into the weekend. In August, the index posted a minus of 1.7 percent. The S&P 500 rose by a minimal 0.1 percent to 2,926 points on Friday. The Nasdaq 100 gave way 0.2 percent to 7,691 points.

Oil market under pressure

Meanwhile, there is interesting news on oil. According to Reuters, OPEC production increased in August because – as so often – there is no discipline in the cartel. Iraq and Nigeria, in particular, pumped more oil. Production was 29.6 million barrels per day, 80,000 barrels above the July level. This is an astonishing development when the supply from Iran and Venezuela has shrunk. No wonder that the oil price has come under pressure recently.

This is what the day brings

There is a yawning emptiness in the appointment calendar, which is likely to lead to restraint on the stock markets. For investors who trade stocks online, it’s more like a lost day. But not for everyone who trades CFDs – they can make a good return even with the smallest stakes thanks to the leverage.
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.

30.08.2019 – Daily report. Now the bulls are doing well again: The latest conciliatory signals from Beijing are boosting prices in global trading. The hard bandages of Donald Trump seem to be having an effect. But only one thing is certain in the looming trade war: volatility is at its limit.

Green prices in Frankfurt

After Thursday’s saturational plus, investors are also taking a cautious approach again on Friday. Germany’s leading index gained around one percent at noon, most recently trading at 12,000 points. The DAX now appears to be sitting stable again on the 200-day line. What happened? Quite simply: The Chinese apparently want to avoid an escalation in the customs dispute.

Beijing signals a turning away

On Thursday, the Chinese Ministry of Commerce raised the white flag a little bit. China will not react immediately to the new tariff increases by the Trump administration, which are due to come into force on September 1, said ministry spokesman Gao Feng. An escalation in the trade dispute would benefit neither China nor the USA. And he continued: Both sides are currently working on the details of new trade talks in September.
In addition, US President Donald Trump said without details that today’s agenda included talks on the subject of trade for the USA and China. New US tariffs on Chinese goods worth 300 billion dollars will come into force on 1 September.

Who feels the pain?

So are we getting closer to an agreement? Perhaps. The customs dispute apparently weighs heavily on the Chinese middle class. The evidence for this thesis is a bizarre footnote: Several lobster fishermen in the US state of Maine reported a slump in lobster exports to China – sometimes US exports to the Middle Kingdom fell by up to 80 percent. However, the Canadians jumped into the gap, even if they did not completely fill it. More importantly, the Pentagon will open up new sources of rare earths in Australia. This means that the USA will be able to exert pressure on the People’s Republic.

Anticipation overseas

So are we going to see an agreement soon? Let us wait and see. The hope of an end to the conflict has boosted overseas courses. The CSI-300 only posted a plus of 0.3 percent to around 3,800 points. However, the Nikkei finished trading on Friday with a gain of 1.2 percent at 20,704 points. In August, the leading index in Japan lost 3.8 percent.
In the USA, the Dow Jones benchmark index rose by 1.3 percent to 26,362 points the previous evening. The broad-based S&P 500 also climbed by 1.3 percent to 2,925 points. The Nasdaq 100 even advanced by 1.5 percent to 7,702 points.
But beware: Dow, S&P 500 and Nasdaq Composite as well as Nasdaq 100 have now torn price gaps that want to be closed.

This is what the day brings

The calendar brings some interesting events, you can find the overview as always here: Market Mover
At 2.30 pm, the data on personal income and consumption in July will first run through the tickers.
Somewhat later, at 3:45pm, the Chicago purchasing managers’ index for August is reported.
Shortly thereafter, consumer confidence for August runs from the University of Michigan via the tickers at 4 pm.

Bernstein-Bank wishes successful trades and a sunny 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.

EURO

After Friday’s rally, the euro/dollar pair is correcting for the second day amidst the news of Chinese duties on a number of goods from the U.S. The price is at the opening level of last week, which means that bulls and bears are trying to pull the rope unsuccessfully. Sellers are morally helped by the large positive swap they get while holding their shorts.
It should be noted that the situation resembles a compressed spring. And its straightening should be expected not because of low volatility, but because of the end of the holiday season and the return to the market of investors and traders. All the most interesting things will begin in early September.

Gold

Gold continues the strong trend of the last three months. Monday was marked by a gap after the weekend, which closed the same day. Stops were collected on both sides and, quite naturally, on Tuesday the growth continued. The situation is aggravated by the growing tension in the Middle East, after the Israeli Defense Forces strikes on Hezbollah facilities in Lebanon.
Trump’s agreement with China on trade duties could turn the situation around, but when that happens, the issue is still open. So far, it seems that nothing can stop the trend. The technical picture confirms the fundamental, we see on the chart that simple moving averages in 20, 50 and 200 days are lined up in an ideal ratio for the trend market.

DAX

Today the data on German GDP for the second quarter was released. Growth in annual terms was equal to 0.4% forecasted by experts. Against the background of the slowdown in the global economy due to the ongoing trade wars, this is a good indicator. Especially considering the drop in demand for German products from Chinese producers.
Yesterday’s break-up of the 200-day moving average turned out to be once again false. The price has returned today. In the next few days we can expect a way out of the August corridor in one direction or another.

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.