22.11.2019 – Daily Report. Wall Street corrects slightly. But the DAX is picking up in early trading. Brokers are looking to moderately positive economic data from Germany. Meanwhile, little is happening in the customs dispute between China and the USA.
The stock market players on the German stock market recently positioned themselves on the bullish side. The DAX climbed by 0.7 percent to 13,232 positions. The Federal Statistical Office confirmed an earlier estimate that the German economy has narrowly escaped the recession thanks to the robust domestic market and rising exports. Gross domestic product (GDP) grew by 0.1 percent between July and September compared with the previous quarter. In the second quarter, GDP had shrunk by 0.2 percent, while in the first quarter it had risen by 0.5 percent. On the currency market, traders were waiting for the first programmatic speech by the new head of the European Central Bank, Christine Largarde.
Ping-Pong in the customs dispute
The uncertainty surrounding the customs dispute between China and the USA continued to be the determining issue. The stock market was torn back and forth by conflicting reports. China’s President Xi Jinping said on Friday that his country was interested in an agreement. Beijing is trying to avoid a trade war, but is not afraid to strike back if necessary.
Meanwhile, the official “South China Morning Post” warned of consequences if US President Donald Trump signs the US Congress’ Pro Hong Kong bill. And the influential editor-in-chief of the Communist-linked Global Times, Hu Xijin, tweeted yesterday that US farmers should better wait with the purchase of larger tractors – that would be safer in six months. Purchases in US agriculture are a core demand of the US administration. Yesterday, the Wall Street Journal also reported that China had invited a high-ranking US delegation to Beijing for negotiations, which could take place before Thanksgiving next Thursday.
Mixed picture in Asia
Nevertheless, Chinese equities declined. The CSI-300 with the most important red chips of the People’s Republic lost about 1 percent to 3,850 points. Brokers cited as the reason the passage of two Chinese warships off islands in the South China Sea, which had been
Beijing will be complained of. Investors fear that this demonstration of power could fuel the trade conflict again. Meanwhile, the Nikkei rose by 0.3 percent to 23,113 points.
Vietnam replaces China
China would have good reason to conclude an agreement with the USA. After all, the American industry is in the process of looking for new suppliers. CNBC, for example, reported a strong increase in imports from Vietnam of around 35 percent for the first nine months of the year. Demand was particularly strong for computers and telephony equipment. In the same period, imports from China fell by around 14 percent, as the figures from the management consultancy Markit show.
New York hesitates
The brokers had previously held back on Wall Street. The Dow Jones Industrial fell by 0.2 percent to 27,766 points on Thursday. The S&P 500 also lost around 0.2 percent to 3,104 points. The Nasdaq 100 also fell by 0.2 percent to 8,266 points.
Mixed US economic data left investors cold. The Philly Fed index in November was better than most economists had expected. The number of first weekly applications for unemployment benefits was robust. By contrast, the composite index of leading economic indicators slipped in October for the third consecutive month. And sales of second-hand real estate in October were somewhat weaker than had been hoped. As always, you can find the overview here: Market Mover
That’s what the day brings
The schedule before the weekend is rather thin.
The consumer confidence of the University of Michigan is supposed to arrive at 4:00pm.
The “Frankfurt European Banking Congress” will be attended by ECB President Christine Lagarde and Federal Finance Minister Olaf Scholz, among others.
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.