09.12.2019 – Daily Report. The American job engine is booming, Wall Street is providing a strong model for trading in Frankfurt. The US indices are lurking just below the all-time highs. But the DAX is starting the trading week cautiously. Investors are also waiting for the customs dispute to be settled.
Take a breather in Frankfurt
On Monday morning, the DAX fell by 0.1 percent to 13,148 points. The indicator thus followed the US futures on the Dow and S&P 500, which fell by 0.1 percent. Anyone trading stocks online is once again stagnating. And those who are invested in Germany’s best CFD brokers can still use the standstill for their trades thanks to the lever.
Investors recently ignored positive signals from the German economy: in October, exports increased by 1.9 percent compared to the same month last year. The DAX rose by 0.9 percent to 13,167 points on Friday, driven by Wall Street. The weekly balance thus stood at minus 0.5 percent.
That’s why Beijing needs the deal
Meanwhile, a report arrived in the customs dispute on Sunday that the White House must have enjoyed reading. Exports from the People’s Republic of China fell surprisingly in November – for the fourth month in a row. According to the customs authorities, the minus was 1.1 percent compared to the same month last year. Exports to the USA fell by almost a quarter. Overall, the economy in China is growing more slowly than at any time in almost 30 years.
Meanwhile, there was a positive comment from the second row on the customs deal: According to Reuters, the Chinese Trade Secretary Ren Hongbin said on Monday in Beijing that they were counting on “being able to reach an agreement as quickly as possible that satisfies all sides”. So the market is still waiting to see whether Phase 1 will be signed before 15 December. If not, the US wants to impose new punitive tariffs on Chinese products.
Asia with mixed tendency
The CSI-300 closed the morning down 0.2 percent at 3,895 points. In view of the large pro-democracy demonstration on Sunday in Hong Kong, Hang Seng left the day unchanged at 26,495. In Japan, the Nikkei rose by 0.3 percent to 23,431 points.
Strong data support Wall Street
On Friday, investors on Wall Street had taken a firm grip. The Dow Jones Industrial gained 1.2 percent to 28,015 points, the best trading day in a good two months. The index thus reduced its weekly minus to 0.1 percent. Thanks to its performance, the Dow is only 0.5 percent short of its all-time high of 28,164 points on 27 November.
The S&P 500 advanced by 0.9 percent to 3,146 points on Friday. And the Nasdaq 100 climbed 1.1 percent to 8,397 points. The US indices have now torn smaller upward gaps again. You can already guess: The chart analysis teaches that such gaps are normally closed again.
The US job engine is humming
The main reason for the optimism was the strong job report. In November, 266,000 new non-agricultural jobs were created in the USA. Most experts had expected only 186,000 jobs. In addition, wages have risen; at the same time the unemployment rate has fallen to 3.5 percent, the lowest level since 1969. The Conference Board also reported a strong plus in its indicator of 99.2 points from 96.8 points in November. All data can be found here: Market Mover
The Fed sees itself confirmed
The US Federal Reserve should see its course confirmed in the light of the strong data. The most recent move was to wait and see. And so the key interest rate is likely to remain unchanged on Wednesday in the last session this year. Which should support the Dollar.
OPEC+ cuts production
Investors in the oil market did not trust the latest OPEC deal, Brent lost 0.4 percent to 63.95 dollars, WTI slipped 0.3 percent to 58.88 dollars. OPEC+ has now officially decided to cut its oil production by a further 500,000 barrels per day in the first three months of 2020. Saudi Arabia also wants to cut its emissions by a further 400,000 barrels a day. All in all, according to Saudi Arabia, the cartel and its allies are cutting their daily output by 2.1 million barrels.
This is what the day brings
The appointment calendar is only sparsely filled at the beginning of the week.
The only time it should be exciting is at 4:00pm when the ISM’s half-yearly economic outlook arrives in the USA.
The Bernstein Bank wishes successful trades!
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