Wall Street hawks – Frankfurt hesitates

By 26/11/2019News
Trade

26.11.2019 – Daily Report. Not again: Brokers in the USA are buying in view of the new hope in the customs dispute. But German investors are waiting. Real news is in short supply.

DAX hesitates

The stock exchange in Frankfurt has a problem with its handbrake – it is constantly on. Once again, brokers in Germany ignored the positive targets from the USA. In early Tuesday trading, the DAX fell by 0.3 percent to 13,209 points. And this despite the fact that although GfK reported an increase in its consumer climate barometer of 0.1 points to 9.7 points, this was below some forecasts. An overview of all data can be found here:
Market Mover

So there is still a sideways tendency. The back and forth is good for you, if you trade CFD – then you can trade thanks to the leverage also smallest movements in yield. The situation looks frostier if you trade stocks online. On the trading platform, the free real-time prices have hardly moved recently. The Dow future remained unchanged at 28,048 points, while gold gained 0.2 percent to 1,458 dollars.

The tailwind is fading

The day before, positive news had been circulating about the China-USA customs dispute, including speculation that Beijing would more severely punish intellectual property infringement, Bloomberg wrote. Yesterday we had reported here in detail about the other news. But on Tuesday this tailwind was missing.

The state Chinese news agency Xinhua reported a telephone conversation between both sides. Beijing and Washington had discussed their core interests and agreed to resolve the issues in question “appropriately”. CNBC became a little more concrete and translated a message from the Chinese Ministry of Commerce. China’s chief negotiator Liu He telephoned the US Trade Representative Robert Lighthizer and Finance Minister Steven Mnuchin today. Both sides had reached a consensus on how to solve problems and had agreed to stay in contact for a Phase 1 agreement.

Do or Die in the Customs Controversy

Meanwhile, Reuters, citing experts in China and the U.S., noted that the completion of the much more difficult Phase 2 is becoming less likely. Among other things, industrial spying and copyright are to be negotiated in this step. One obstacle was the US’s decision not to use other countries to exert pressure on Beijing. On the other hand, China is likely to wait and see whether US President Donald Trump wins the US presidential election in 2020.

Jeremy Siegel, professor at the prestigious US University Wharton, just explained what is at stake for the bulls in an interview with Bloomberg TV. According to him, the market expects some agreement in the next three months. If this is achieved, the S&P500 is likely to rise by 10 percent. But if this fails, or if nothing at all is achieved by the deadline of December 15th for the next customs round, a selloff of 15 to 20 percent threatens.

Mixed trend in Asia

Investors in Asia were still cautiously optimistic. The Chinese CSI-300 rose by 0.4 percent to 3,892 points. The Nikkei in Tokyo also gained 0.4 percent to 23,383 points. The Hang Seng in Hong Kong recently lost 0.1 percent to 26,952 points.

Record hunting in New York

The evening before, the US brokers had taken the initiative. The Dow Jones Industrial dropped out of trading with a plus of 0.7 percent at 28,066 points, just below its daily high. This brought the leading index closer to its recent high of around 28,090 points last Tuesday.

Meanwhile, the other major US indices climbed to new record highs. The S&P 500 gained 0.8 percent to 3,133 points. The Nasdaq 100 gained 1.2 percent to 8,371 positions. And the market-wide Nasdaq Composite also set a new final record with an increase of 1.3 percent to 8,632 points.

That’s what the day brings

On Tuesday at 14:30 it will be exciting when the US retail data arrive.

At 16:00 US consumer confidence will be released in November.

At the same time, US new building sales for October will be running on the tickers.

And at 22:30 the private American Petroleum Institute (API) reports the weekly crude oil stock data.

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.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 81% of retail investor accounts lose money when trading CFDs with this provider.
You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.