24.06.2019 – Daily report. Lethargy on the Frankfurt Stock Market. No activity in the heat wave. And by no means ill-considered commitments before the upcoming G-20 summit in Japan. There could be a breakthrough in the customs dispute. Or the outbreak of an open trade war. Especially as the Iran crisis continues to smoulder. The ifo index also offers no incentives to buy.
The DAX crumbles
The DAX fell by around half a percent by Monday midday. In line with the international negative factors, the Ifo index has also been included in the most recent bear scenario on the Frankfurt Stock Exchange. The business climate index fell to 97.4 points in June. “The mood on the German executive floors has cooled further,” commented Ifo President Clemens Fuest. Daimler has also lowered its profit forecast for the third time this year. The share was the biggest loser in the benchmark index. This is bad news for Chancellor Angela Merkel’s car summit today.
Wait and see in Asia
Investors in Asia were also reluctant to rush into equities. US President Donald Trump and China’s head of state Xi Jinping want to meet at the end of the week on the fringes of the summit in Osaka. The Hang Seng climbed 0.1 percent to 28.513 points. The Nikkei also closed Monday 0.1 percent higher at 21,286 points.
Meanwhile, Washington once again cracked the whip: After Huawei, the USA has put five more companies and organizations from China on the black list. The five are thus classified as a risk to national security.
Wall Street is stagnating
In view of the general weather situation, New York’s stock exchange investors had also kept a low profile. The S&P 500 lost 0.1 percent to 2950 points on Friday. The Dow Jones Industrial also fell by 0.1 percent to 26,719 points. After all, the Dow still managed a weekly gain of 2.4 percent. The Nasdaq 100 also lost 0.1 percent to 7,729 jobs on Friday.
New sanctions against Iran
The news remains that the USA is planning new sanctions against Iran. Which, in view of the sluggish market, should at least bring a little movement in real-time prices in the energy market. Trump wrote on Twitter on Saturday that “significant additional sanctions” would be announced this Monday. At the same time he offered Tehran to repeal the sanctions. The condition for this is that the leadership in Tehran must make a permanent commitment not to build a nuclear bomb. He went on to say that the military option was also “always on the table until we get a solution”. Needless to say, in view of a possible escalation, you need to keep a regular eye on your market updates.
This is what the day brings
The appointment calendar is only thinly filled at the start of the week. The Chicago Fed National Activity Index is due for May at 2:30pm.
And at 3:45 it could be interesting for bond traders. The European Central Bank announces the weekly change in the Eurosystem central banks’ holdings of government bonds, covered bonds, corporate bonds and ABS.
Bernstein-Bank wishes you every success with your trades!
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