21.08.2019 – Daily report. Investors are getting back to it. Amazing, because the US Federal Reserve could shake up the market. In the evening, the Fed protocol will be exciting. The reading will be particularly interesting this time, as the July meeting did not unanimously decide to cut interest rates.
The DAX rises
Germany’s leading index has climbed relatively significantly. Most recently, the leading German index rose by 1.2 percent to 11,791 points. Will this trend continue? The Fed minutes of the meeting on 31 July, the date on which the Fed lowered interest rates, will be published at 20:00 hrs. Brokers on the financial market will then be eagerly awaiting their regular market updates. They are hoping for new indications as to the extent of possible future monetary policy steps. A speech by US Federal Reserve Chairman Jerome Powell at the Jackson Hole meeting on Friday could also provide new impetus. The government crisis in Italy also caused restraint.
Novelty in the bond market
Meanwhile, the German government wanted to continue to benefit from investors’ risk aversion. In the morning, the German government for the first time offered a 30-year bond with a zero interest rate. The Federal Republic therefore does not pay interest until August 2050, the bond holder only receives the deposited money back nominally in the case of a zero-coupon bond. The state wanted to collect 2 billion euros with the sale of the government bond. If you read these lines, you already know more.
Caution in Asia
The Asian stock markets were also cautious in the morning. The Nikkei closed in Tokyo with a minus of 0.3 percent at 20,619 points. The Chinese CSI-300 lost 0.2 percent to 3,782 points. The smartphone manufacturer Huawei confirmed that US President Donald Trump had hit the Chinese hard with his hard line in the customs dispute. According to CNBC, founder and CEO Ren Zhengfei told employees that Huawei was facing a crisis that meant life or death. Washington has just given Huawei 90 days to continue doing business in the US. It remains to be seen whether the blacklist threatens afterwards.
Backstabbers in New York
With the Fed expected to speak, and against the backdrop of the smoldering customs dispute with China, New York’s New York stock market was also cautious the night before. The Dow Jones Industrial lost 0.7 percent to 25,962 points on Tuesday. The S&P 500 fell by 0.8 percent to 2,901 points. And the Nasdaq 100 fell by 0.7 percent to 7,664 points.
This is what the day brings
In addition to the Fed protocols at 8 p.m. there are two particularly interesting dates on the calendar, all dates can be found here: Market Mover
First, at 4:00pm the resale of US homes in July will be reported.
At 4:30pm the weekly oil report will follow.
The Bernstein Bank wishes successful trades!
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