05.04.2019 – Daily report. First, sit back and relax: After the new annual high on Thursday, investors at the Frankfurt Stock Exchange are taking it easy on Friday morning. In the afternoon, the important labour market data from the USA is due. These will potentially move the US futures and also the DAX strongly. The stock market has received support from US President Donald Trump: He described an agreement in the US trade dispute with China within four weeks as possible. Now he and the leadership in Beijing must deliver.
DAX commutes below 12,000
Lethargy in Frankfurt: The DAX stabilized at just under 12,000 points on Friday morning with slight losses. Real-time prices on the trading platform have been flashing sluggishly recently – movement was frowned upon, rest was the order of the day. No wonder: on Thursday, the leading index had crossed the 12,000 mark again for the first time since the beginning of October. Specifically, the DAX reached 12,029 points.
Economy versus chart technology
Positive news from the German economy provided support on Friday. Companies in Germany increased their production in February despite falling orders in industry. Industry, construction and energy suppliers together produced 0.7 percent more than in the previous month, according to the Federal Ministry of Economics.
Two facts, however, are causing frowning among friends of technical and chart analysis with regard to the DAX: On the one hand, the most recent increase was accompanied only by low sales. This means that the plus only rests on a few shoulders. If they change their minds, things can quickly go downhill. On the other hand we have in the candle daily Chart of the past five days now already two Gaps. Price gaps are usually closed, the question is when. So the food for the bears is ready.
Hope for a deal in the customs dispute
Most brokers, however, were optimistic recently: in light of the hoped-for end to the customs dispute between the USA and China in the near future, the general mood is positive. Trump had announced yesterday that the USA and the People’s Republic are well on their way to a “great agreement”. China’s Deputy Prime Minister Liu He also spoke of great progress. The optimism in the White House also infected investors in Japan: The Nikkei index rose by 0.3 percent to 21,793 points on Friday. The stock exchanges in China remained closed due to a holiday.
Profits on Wall Street
The most recent winning streak in New York continued on Thursday as a result of the hoped-for China deal. In addition, the US labor market remains robust. The number of first weekly applications for unemployment benefits has fallen to its lowest level in almost 50 years. It is no wonder that the Dow Jones recorded a gain of 0.6 percent at 26,385 points at the closing bell. This is the highest level since the beginning of October. The S&P 500 rose by 0.2 percent to 2879 points. Only the Nasdaq 100 fell by around 0.1 percent to 7541 points.
US job data in focus
The best always comes at the end: The highlight of the Börsenwoche on Friday afternoon will be the US labour market report for the month of March. At 14.30 it will be really exciting. The forecasts are for a plus of 176,000 new non-agricultural jobs. Any disappointment should rekindle fears of the recession. Each overfulfillment might lend new Kraft to the bulls. The Bernstein Bank hopes that you will place your CFD trades on the right side!
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.