23.10.2019 – Daily Report. What does yesterday’s Brexit drama in London mean? And what about the US economy after disappointing quarterly figures? The stock market in Frankfurt is analysing the confusing situation and is holding back for the time being.
Mixed targets slow Frankfurt down
The DAX remained unchanged at 12,755 points on Wednesday morning. Nevertheless, last Thursday’s high for the year of 12,814 points remains within reach. Yesterday the positive run in the US reporting season came to a standstill: McDonald’s and the toy manufacturer Hasbro presented disappointing figures. Facebook also slipped after the New York public prosecutor’s office announced that it would expand its investigations against the social network for data protection negligence. Other news that moved the share price were initially in short supply.
Victory for Johnson in Brexit
At Brexit, the mainstream media mainly pushed up Boris Johnson’s vote defeat once again. Which could mislead you if you trade CFDs or online stocks, or the FTSE 100, because on Tuesday evening MEPs rejected Johnson’s tight timetable for the debate on the Withdrawal Agreement Bill (WAB). By 322 votes to 308. The British Prime Minister has now put his EU withdrawal legislation on ice.
But in fact the evening was a historic turning point for Europe. For the first time ever, the House of Commons has accepted an agreement with Brussels on the Brexit Treaty. The House of Commons voted surprisingly clearly on Tuesday with 329 votes to 299 in favour of the government’s proposal. The agreement negotiated with the EU last week will thus be incorporated into British law.
Possible new strength in pound sterling
For Sterling, this means short-term uncertainty in the context of the delay and the confused situation. However, new strength could emerge as soon as Johnson actually succeeds in getting a regulated Brexit through in the end, albeit with delays. But let’s wait and see – anything is possible in this matter and the opposite of everything.
Mixed targets from Asia
The contradictory overall situation had an impact on Asia. In China, the CSI-300 fell by 0.7 percent to 3,870 points. In Tokyo, on the other hand, the Japanese Nikkei-225 closed 0.3 percent higher at 22,625 points. The index thus continues to move close to its high for the year. The Nikkei made up for the holiday break on Tuesday. The Hang-Seng index in Hong Kong fell by 0.8 percent to 26,567 points. According to the Financial Times, Beijing is considering replacing the controversial Hong Kong head of government Carrie Lam. A successor could be appointed by March.
Moderate decline in New York
Given the dampeners in the reporting season, Wall Street had reset the night before. The Dow Jones Industrial lost 0.2 percent to 26,788 points. The S&P 500 slipped by 0.4 percent to 2996 points. The Nasdaq 100 fell by 0.8 percent to 7,875 points.
Bundesbank buys gold again
Finally, an interesting fact remains for gold bugs: the Deutsche Bundesbank has reported gold purchases for the first time in 21 years. ZeroHedge reported this with reference to Bloomberg. According to the report, reserves rose to 108.34 million ounces in September after 108.25 million ounces in August.
This is what the day brings
Today, Wall Street looks primarily at figures from Boeing, Ford and Microsoft. AT&T, Caterpillar and Ebay also open their books.
The diary is otherwise rather sparsely filled, the overview can be found as usual here:
Initially, the FHFA house price index for August will be available in the USA at 3 p.m. German time.
At 16.00 consumer confidence in the euro zone is expected for October.
At 16.30 the crude oil stock data follow the national Energy Information Administration.
The Bernstein Bank wishes you successful trades!
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