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China vs America

Psycho-war against China’s elite

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23.05.2019 – Special report. The customs dispute between China and the USA is threatened with escalation, which could end in an open trade war. Washington wants to put at least five more Chinese companies from the security sector on the blacklist. This is an interesting move by the Americans that directly targets the security needs of the communist leadership. We analyse the background and show what opportunities there are for CFD traders.

US attack on Big Brother China

In our stock market report, we had just expressed the suspicion that the USA, after Huawei and Hangzhou Hikvision Digital Technology, the world’s largest manufacturer of video surveillance systems, would probably add further companies to the blacklist. As soon as our Daily Report from Wednesday went live, corresponding news hit the market.
The USA is currently investigating whether other Chinese companies will be blocked from cooperating with global partners. The financial blog “ZeroHedge” named the names: Megvii Technology develops technology for face recognition. iFlyTek is working on software for voice recognition. And Meiya Pico focuses on digital forensics and cyber security. The blog also referred to Bloomberg – the news agency also called Zhejiang Dahua Technology, also a provider of video surveillance technology. These shares have already been shaken on the stock exchange and are likely to be short candidates until the customs dispute is resolved.

Police state in sight

The USA is apparently targeting the Chinese police state. The possible calculation behind it: If the surveillance technology doesn’t work as soon as the economy slides into recession in the trade war with the USA and the people grumble, then it becomes uncomfortable in the Maoist leader bunker. The sheer number of surveillance cameras proves that the old Communist Guard fears the rebellious people. A total of 600 million cameras are to be installed in China. The old cadres still have the memory of the Tiananmen massacre thirty years ago in their minds – the demonstrations for more democracy proved how unpredictable the masses are.

National pathos

The fact that the Chinese CP is apparently more than nervous in the meantime underscores the nationalist resentments that are currently being stirred up. President Xi Jinping compared the problems with a “new long march”, referring to the country’s founding myth. Recently, state broadcasters have been showing anti-American films about the Korean War again. In addition, the “Trade War Song”, a former civil servant’s idea, is circulating in the social networks. It says: “Trade war, trade war! Tens of thousands of Chinese share the bitter hatred of the enemy”. The song is based on the soundtrack of the film “Tunnel War” from 1965, in which Chinese fight against the invasion of Japanese troops in the Second World War.

The strategy could work out

Our conclusion: The USA has hit a sore spot with the security industry because it is the life insurance of the elite. If Beijing also resists, China could be forced to give in. Especially since the USA has already begun to substitute Chinese goods. As an analysis by Deutsche Bank shows, imports from the rest of the world rose by around 15 billion dollars between the beginning of the year and March, while imports from China fell by around 15 billion dollars. So anyone who believes that China must give in should position themselves in the bull camp on Wall Street – if the customs dispute is resolved, the stock market will boom.

The leadership needs the weak yuan

But until that happens, Beijing is doomed to preserve the prosperity of its people under all circumstances. The means of choice could be to devalue the yuan to make exports cheaper.

Counterattack on Apple and Rare Earth Elements?

Furthermore, the state leadership must not lose face, so countermeasures against the USA could be pending. One possibility is rare earth elements – the majority of US imports come from China; the country currently also produces almost 40 percent of these metals, which are important for the high-tech industry, such as lanthanum, neodymium or yttrium. Since a boycott would put domestic industry champions such as China Rare Earth Holdings in turbulence, the Chinese are more likely to raise prices drastically. If the Americans can’t switch to other suppliers, Chinese corporations would probably gain on the stock market because sales are rising.
Another target for the Chinese anger is already Apple. A boycott campaign is currently underway in China – away from the iPhone towards the Huawei smartphone. It cannot be ruled out that Beijing will also officially tighten the screws at component supplier Foxconn and stop delivery. With corresponding consequences for sales and the stock market price of Apple.

You see: Politics offers CFD traders interesting investment opportunities.
We look forward to the next steps in the trade dispute.

This is what the day brings

The Thursday schedule is well filled. At 2.30 p.m. German time, for example, the weekly US first-time applications for unemployment benefits are being made via the tickers. At 3.45pm the Markit Purchasing Managers Index Service for May follows, ditto the manufacturing index for May. New US construction sales are scheduled for 16:00 in April.
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.

Chart Stock Market

Ifo-Index and customs dispute sink the DAX

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23.05.2019 – Daily report. The bears determine what happens on the Frankfurt Stock Exchange. The ifo index disappointed. Once again, scepticism about the outcome of the customs dispute between China and the USA gained the upper hand in global trading. Washington is likely to put further Chinese companies from the security sector on the black list.

Investors fear stocks

Weak stocks; Japanese yen, Swiss franc and US bonds firm: roughly speaking, this is the typical pattern on the trading floor when worries about a Chinese-American trade war take over. The DAX slipped by almost two percent by noon. At least at Daimler there is an all-clear for the investors: The stock slipped mainly because of the dividend payout. The situation is less good for Deutsche Bank shares: on the day of the Annual General Meeting, the share price hit a record low of 6.35 euros.

Ifo index disappointed

The Ifo index provided food for the bears: the business climate fell from 99.2 to 97.9 points, the second time in a row. Most analysts had expected only a slight drop to 99.1 points. The mood among the 9,000 managers surveyed is therefore poor. “The German economy continues to lack momentum,” commented Ifo President Clemens Fuest.

Customs dispute continues to weigh on the economy

However, the customs dispute between China and the USA remained the determining issue. According to media reports, Washington is investigating whether it will blacklist at least five other Chinese companies in the security sector. Reactions in the Chinese state press also suggested an escalation.

Overseas sales

Previously, Asian investors had positioned themselves accordingly on the sell side: The Nikkei lost 0.6 percent to 21,151 points and the CSI 300 even lost 1.8 percent to 3,584 points.
Wall Street also closed Wednesday in the red. The Dow Jones index closed 0.4 percent lower at 25,777 points. The broader S&P 500 fell 0.3 percent to 2856 points. The composite index of the technology exchange Nasdaq lost 0.5 percent to 7,750 points. The minutes of the last meeting of the US Federal Reserve hardly moved the prices. As expected, the Fed is sticking to its cautious monetary policy.

May probably on the verge of collapse

Meanwhile, forex traders are once again looking to Britain. According to “The Times”, the unfortunate Prime Minister Theresa May wants to announce her resignation this week. The probable date for her resignation is tomorrow, Friday. Conservatives will probably experience a violent debacle in the European elections and the Brexit supporters will triumph. Against the dollar, the pound slid to 1.2608 dollars, its lowest level since January.

This is what the day brings

The Thursday schedule is well filled. At 2.30 p.m. German time, for example, the weekly US first-time applications for unemployment benefits are being made via the tickers. At 3.45pm the Markit Purchasing Managers Index Service for May follows, ditto the manufacturing index for May. New US construction sales are scheduled for 16:00 in April.
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.

New York Boerse

Wall Street trapped in no man’s land

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22.05.2019 – Special report. The indecision on the US stock exchange has been palpable over the past few days. The chart technique is visible proof of this: Wall Street, with all its important indices, is trapped in no man’s land between the moving 50-day average and the 200-day line. The indices won’t remain there forever – soon it’ll be hopping or topping.

No crisis clarification in sight

One step forward, one step back – global trade is waiting for a clear announcement in the various crises. The decisive topics were and are the customs dispute between China and the USA as well as the boiling up of the Iran crisis with potentially violent effects on the global oil market. According to a survey by Reuters/Ipsos, 51 percent of Americans expect a military conflict in the coming years. This is eight percentage points more than in a similar survey in June. Enough sugar in the tank to make the stock market engine stutter.

Caught between 50 and 200-day line

As a result, both S&P 500, Nasdaq 100 and Nasdaq Composite have slipped below the 50-day line in past sessions. And here all indices on the daily candle chart hang above the 200-day line, which acts like a magnet on prices from below. Most of all, the high-tech indices are still defending themselves against the downward pull.

Particularly strong skepticism in Dow Jones

The Dow Jones Industrial showed the least resistance to the pull: Earlier than the other indices, it entered the region between day and night.

The index has now relatively clearly marked the 50-day line as the upper resistance, from below the 200-day line serves as support. What does that tell us? Clearly, investors in the old economy are far more risk averse than colleagues who invest in high-tech. No wonder, they are more dependent than others on solving political crises. Keywords are tariffs, fair trade, booming domestic economy.

Sideways step, joy fireworks or crash

This raises the question of how things could continue. Sometimes the indicators leave the terrain of the undecided quite unspectacularly with a sideways movement. But sometimes not – a big bang and a fall into bear territory is the second variation. A loud cry of joy and an outburst upwards into the bull region is the third possibility.
So be sure to keep an eye on the regular market updates on your trading system in the coming days. And even more attentively than before. A decision on the American stock exchange and in global trading is in the offing. There are enough topics that trigger either a buying frenzy or a bear market.

The Bernstein Bank wishes you every success with your 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.

Market Chart

The DAX defies the standstill

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22.05.2019 – Daily report. What’s going to happen with the big issues in the world? No movement in the customs dispute between China and the USA. Perhaps even new punitive actions by the Americans. More provocations about Iran. It’s no wonder that the Asian stock market remained on the sidelines. Nevertheless, the DAX gained moderately.

The DAX wants to go up

The DAX posted moderate gains on Wednesday afternoon. The targets from the USA looked good: The Dow Jones Industrial advanced by 0.8 percent to 25,877 points on Tuesday. The US government loosened the strict measures against Huawei that had only been enacted last week. For an initial period of 90 days, some transactions are now permitted again, primarily for the supply of smartphones that have already been delivered and the operation of mobile networks. The Nasdaq 100 recovered by around 1 percent to 7451 points and the S&P 500 climbed by 0.9 percent to 2864 points.

Chinese water torture against Beijing

But then news about the tariff dispute hit the US futures and the yuan, the Nikkei crawled up by only about 0.1 percent to 21,283 points. And the Chinese CSI 300 slipped 0.5 percent to 3,649 points.
That had happened: According to a report in the New York Times, the Trump administration wants to prohibit another Chinese high-tech company from buying American technology. Specifically, Hangzhou Hikvision Digital Technology is to be blacklisted. The company, which is controlled by the Chinese government, is currently the world’s largest provider of video surveillance systems and is active in around 100 countries. Officially, Hangzhou is to be punished for monitoring the Uighurs in China.
This means that Washington is now taking on the next important Chinese group after Huawei. Here, too, there is news. “ZeroHedge” reports that, according to Bloomberg, Huawei has been a candidate for a fist lien in the customs dispute with China for months. The news agency reported that the Trump team had waited in the negotiations until the blacklisting of Huawei turned into a dead end, citing unnamed insiders. Any previous action could have torpedoed the negotiations. The whole thing looks very much like an American attrition tactic against China. It is hard to believe that Washington will not soon be targeting other Chinese heavyweights.

Much action in the oil trade

Let us look at the second major conflict – Iran and co. Huthi rebels supported by Tehran have flown a drone attack on a Saudi airport. The insurgents stressed that the attack was directed against an arms depot in the military part of Najran airport. The Saudis claimed that the Huthis tried to hit a civilian target. According to the New York Times, American intelligence analysts and a US army unit are stationed in Najran.
Meanwhile, Iranian President Hassan Rouhani has rejected an offer of talks by American President Donald Trump. He told the state news agency IRNA that he would prefer diplomacy. But the current situation is unsuitable for talks. He added: “Resistance is our only choice”. So the situation remains explosive.
The most recent meeting of the OPEC+ group, on the other hand, brought relaxation in the oil market. According to Reuters, the cartel and its supporters want to soften the production cut and bring 800,000 barrels of oil a day more onto the market. Alternatively, the cut could be trimmed from 1.2 to 0.9 million barrels. The matter is to be clarified at the meeting in June.

Today’s agenda

The view remains on the appointment calendar. At 4.30 pm German time, the US crude oil inventory data of the state Energy Information Administration (EIA) is transmitted via the tickers. And at 8 p.m. the minutes of the Fed’s Open Market Committee of 30 April/1 May will be published. The Bernstein Bank wishes you 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.

Financial Trade Chart

Calming in Frankfurt

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21.05.2019 – Daily report. A slight counter-movement has set in on the German stock exchange. After the losses of the previous day, the DAX climbed by around three-quarters of a percent on Tuesday. Brokers blamed this on a reprieve for the Chinese telecommunications group Huawei.

Period of grace for Huawei

Small backward role in the trade dispute: Huawei has been on the US government’s blacklist since last Friday. This prohibits US companies from doing business with the network supplier and smartphone manufacturer without government approval. The US authorities suspect Huawei of espionage for Beijing. The case had caused the Nasdaq 100 to slide by 1.7 percent to 7,377 points on Monday. The Dow Jones Industrial lost 0.3 percent lower at 25,680 points and the S&P 500 lost 0.7 percent to 2840 positions.
But now Washington has loosened some of the restrictions. Perhaps out of fear of technical problems, perhaps as a signal in the trade dispute. The company is now allowed to buy US products for 90 days. Huawei is to maintain its existing networks and provide software updates for smartphones, according to the US Department of Commerce.

Breath of relief in China

The most recent development in the morning also gave some confidence to the Asian stock markets. The Chinese CSI 300 climbed by around 1.4 percent to 3,667 positions. However, the Nikkei crumbled by 0.1 percent to 21,272 points. Perhaps traders in Tokyo reacted to an event that has so far received little attention in the mainstream media in Germany: Beijing has just shown the USA and the rest of the world a bad instrument of torture and perhaps, perhaps, persuaded Washington to row back.

Rare earths as instruments of torture

The state news agency Xinhua announced a symbolic visit of Chinese President Xi Jinping to the high-tech company JL MAG Rare-Earth at the weekend. JL MAG Rare-Earth manufactures magnets of all kinds that are used in the automotive sector or in aviation, for example. Interestingly, Xi was accompanied by Vice Prime Minister Liu He, who acts as chief negotiator in the customs dispute with the USA.
As the news agency Bloomberg added, the USA has not yet imposed punitive duties on rare earths from China. Incidentally, around 80 percent of US imports of this raw material come from the People’s Republic. The visit thus appears as a clear warning signal to the USA: if the customs dispute escalates, exports will be stopped. The Chinese trade ministry said on Monday that it would be necessary to wait and see what happens next. CFD traders should keep the possibility of a boycott in mind – and prepare themselves already now with Germany’s best CFD brokers. But please only with providers with a Bafin license.

Smoldering Iran conflict

Meanwhile, Iran has reported that it has quadrupled its production of lightly enriched uranium. The two parastatal news agencies Fars and Tasnim quoted Iranian nuclear agency spokesman Behrouz Kamalvandi as saying that the country would reach the 300 kilogram limit set in the nuclear deal “within weeks”. Meanwhile, US President Donald Trump has once again warned Iran’s leadership against provocation. “Iran would make a big mistake if they did anything,” Trump said yesterday in Washington. But he added: “If they call, we would certainly negotiate.” So on this front there is the threat of further escalation, which is likely to bag up global trade and above all the oil market.

Today’s agenda

Investors should keep an eye on consumer confidence in the Euro-Zone today at 4 pm. At the same time, the figures for the sale of US real estate in April are expected to be ticked off. Finally, the crude oil inventory data of the private American Petroleum Institute (API) is scheduled for 22:30.
The Bernstein Bank wishes you 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.

cfd handel

Waiting and Diving

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20.05.2019 – Daily report. Hardly any movement on the Frankfurt Stock Exchange on Monday midday: After the good previous week, investors initially held back in German stock trading. The DAX crumbled. There was no news in the customs dispute between China and the USA. Nerves remain tense in the energy market: US President Donald Trump threatened Iran.

DAX shows itself listless

After a sideways start, the DAX fell by around three-quarters of a percent. Deutsche Bank tested the all-time low of EUR 6.68, which had been marked at the end of December. According to a report in the “New York Times”, executives of the money house are said to have prevented employees from reporting conspicuous transactions in Trump companies and his son-in-law Jared Kushner to the financial supervisory authorities. Deutsche Bank rejected the accusations.

No progress in customs dispute

Many investors now assume that the negotiations between China and the USA have reached a dead end. As expected, the Organisation for Economic Co-operation and Development has issued a warning regarding the customs dispute. OECD Secretary General Angel Gurria told CNBC that the conflict is holding back global recovery and jeopardising investment and growth.
Meanwhile, the People’s Republic of China has revealed the direction the leadership is taking. The social media blog “What’s on Weibo” reported that CCTV 6, the state broadcaster specializing in films, had broadcast three anti-American movies on the Korean War from the 1950s and 1960s – reaching 500 million people in 23 provinces. This could be dismissed as a tasteless aberration if the editor-in-chief of the Global Times, Hu Xijin, had not summed up the purpose of the action: “There are no negotiations between equals without struggle,” wrote the communists’ mouthpiece on Twitter.

Asia without a clear trend

No clear direction for global trading was given by investors in Asia in the morning: The Japanese Nikkei 225 closed 0.2 percent higher at 21,301 points. In Japan, economic growth grew by 0.5 percent in the first quarter. In China, on the other hand, the stock market remained subdued: the CSI 300 fell by 0.9 percent to 3,618 points.

New York powerless

Wall Street also lacked energy on Friday. Although the Dow Jones had been trading up for a while, it gave way in late trading and took off into the weekend with a minus of 0.4 percent at 25,764 points. The weekly loss of 0.7 percent is manageable. The S&P 500 had slipped by 0.6 percent to 2860 points on Friday and the Nasdaq 100 lost 1 percent to 7504 positions. The mood of US consumers had improved considerably in May and had risen to its highest level in a good 15 years. The composite index of leading economic indicators of the private research institute Conference Board also improved in April. All data can be found here: Market Mover

Fear of the spark in the oil field

There is still tension on the oil market. US President Trump has threatened Tehran with destruction. On Sunday evening he twittered: “If Iran wants to fight, this is the official end of Iran. Never threaten the United States again! The price of oil was higher than it has been for three weeks. The trigger was probably the impact of a rocket about 1.6 kilometers away from the American embassy in Baghdad. Previously, the commander of the Iranian Revolutionary Guards, Hussein Salami, had ignited the rocket: Although Iran and its Revolutionary Guards did not want war, they would not be afraid of it, he told the semi-state news agency Isna. The US troops were “easy to defeat” because, unlike the Revolutionary Guards, they were afraid of death.
As always, it’s worth keeping an eye on the news. Especially on a day when there are hardly any important scheduled dates. The Chicago Fed National Activity Index for April at 2.30 p.m. German time should be highlighted. We wish you a successful week!

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.

online trading

German shares slightly down

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17.05.2019 – Daily report. First of all, take profits with you: On Friday morning, investors in Frankfurt kept a low profile for the time being. After the price run of the previous day, many brokers waited for new economic data in the afternoon. In addition, the small downfall at Eurex is imminent. This could shake up online stock trading considerably. The New York targets were otherwise positive. Meanwhile, China was sceptical about Huawei.

Profit taking on the German stock exchange

The morning is not a good time window for the bulls in the DAX. After the moderate late rally on Thursday, investors initially held back in early Friday trading as well. The DAX was recently around three-quarters of a percent weaker. The possible shift of higher US tariffs to European car imports had caused the gain on the previous day. However, the BMW share was conspicuous on Friday: at the end of the DAX, it was quoted ex-dividend, although the falling return on sales and a provision worth billions for alleged antitrust violations also weighed on the share price.
Volatility in the market as a whole has also been created: At noon, the Eurex derivatives exchange is due to experience its so-called small decline. Then, among other things, the May options on the DAX and the Euro-Zone benchmark index EuroStoxx 50 expire. Before this date, major addresses often try to push prices in the desired direction. This sometimes results in surprising, strong swings. So please keep an eye on your trading platform.

Mixed trend in Asia

Asia presented itself mixed. The Nikkei gained 0.9 percent to 21,250 points in Tokyo on Friday. This week, however, the balance sheet stands at minus 0.4 percent. In Japan, Sony caused a sensation with a price jump of 10 percent: The electronics group reported a cooperation with Microsoft and also a share buyback with a volume of the equivalent of 1.6 billion euros.
In China, on the other hand, the bears were in charge. The CSI 300 slipped by 2.5 percent to 3,649 points. The reason: US President Donald Trump has fuelled the customs dispute with China and declared a national state of emergency in telecommunications. This clears the way for measures against the Chinese telecom group Huawei. The communists in Beijing initially reacted verbally: China is determined to protect its national interests, according to an editorial in the People’s Daily.

Confidence in New York

Wall Street had rallied on Thursday thanks to strong economic data and corporate figures. Walmart and Cisco were convincing. Ditto the business climate in the Philadelphia region in May. In addition, the number of first weekly applications for unemployment benefits had fallen more than expected. The US housing market also proved robust in April. All important economic data can be found here: Market Mover
As a result, the Dow Jones benchmark index closed 0.8 percent higher on Thursday at 25,862 points. The S&P 500 advanced 0.9 percent to 2,876 points. The technology-driven Nasdaq 100 rose by 1.0 percent to 7,580 points.

Today’s agenda

In the USA, consumer confidence at the University of Michigan will be published at 4:00pm. At the same time, the leading indicators for the American economy are supposed to be running on the ticker.
The Bernstein Bank wishes you successful trades and a relaxing weekend!

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.

DAX bröckelt zum Wochenstart

Investors remain under cover

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16.05.2019 – Daily report. The DAX had only just risen – because US President Donald Trump probably wants to postpone threatening import duties for cars from Europe. The cold shower came next: Apparently he expects something in return from the European Union. Exports to the USA are to be capped. The DAX has slightly decreased.

DAX narrowly maintained

Little movement on the trading platform: After the nice gains on Wednesday, the German equities presented themselves somewhat weaker on Thursday. In the morning, the DAX moved just below the 12,100 mark. What is the future for German car stocks? According to the latest media reports, Trump will postpone the decision on punitive tariffs for European cars by up to six months. Actually the decision should have been made at the end of this week. But then the news that a concession is probably tied to conditions.

No clear trend in Asia

The Nikkei had fallen 0.6 percent in the morning to 21,063 points. The Chinese CSI 300 gained 0.5 percent to 3,744 points. Meanwhile, it is becoming clear how China is going to finance its stimuli with which, for example, it is pushing up stagnating car sales: with the sale of American government bonds. China sold $20.5 billion worth of Treasuries in March, the US Department of Commerce announced Wednesday. That was the highest value since October 2016. At the same time, of course, it is one of the means to hit the US in the customs dispute. However, Beijing remains the largest creditor of the USA: the People’s Republic still held bonds worth 1.1 trillion US dollars in March. But if Beijing buys yuan instead, how can the domestic currency be lowered to boost foreign trade? Things remain exciting.

Rising courses in New York

Wall Street was in a buying mood on Wednesday. Prices only turned down after the disappointing US retail data. In the wake of the announcement that Washington apparently does not want any further conflict over car tariffs with Japan and Europe apart from the customs dispute with China, investors resorted to the news. The Dow Jones Index ended the day up 0.5 percent at 25,648 points. The market-wide S&P 500 gained 0.6 percent to 2,850 points. And the Nasdaq Composite gained 1.1 percent to 7,822 points.
Previously, Trump had again exerted pressure on the Federal Reserve. With a little help from the Federal Reserve, economic growth in the United States could be increased to five percent, he said in Louisiana. All it needs is lower interest rates and a “little quantitative easing”.

Escalation in Yemen

Meanwhile, traders in the oil market continue to look forward to the heated situation between Iran and Saudi Arabia. In retaliation for a drone attack on an oil pipeline, the Saudis bombed the Yemeni capital Sanaa, which is controlled by the Huthi rebels. The insurgents are supported by Iran. Among other things, the attacks were directed against arms depots.

Today’s agenda

The afternoon brings some important economic data. At 2.30 p.m. German time the building permits from the USA will be received. The Philadelphia Fed Index is ticking over at this time. Of special importance at the same time are the first applications for unemployment assistance. As always, you will find all dates here: Market Mover
Bernstein Bank wishes you successful trades!

Fresh US data and Brexit launch in London

We are curious to see if the US economic data coming in this afternoon will underpin the renewed optimism. At 2.30 p.m. German time, retail sales will be reported in April, as will the Empire State Index for May, which provides information about the New York region’s economy. At 3.15 p.m. the Federal Reserve will provide figures on industrial production in April, i.e. capacity utilization. The weekly oil report is also due at 4.30 pm.
Traders in the British pound should also note the date for the next act in the exit drama: British Prime Minister Theresa May wants the House of Commons to vote on the Brexit agreement for the fourth time at the beginning of June.
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.

stock market graphic

The DAX oscillates between hope and fear

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15.05.2019 – Daily report. “Speak softly and carry a big stick” – the former president Teddy Roosevelt already knew that. Donald Trump imitates him and first calmed down the stock markets with gentle statements about the customs dispute. But investors don’t quite trust the apparent peace – the DAX is crumbling. Poor economic data from China seems to speak for the strong position of the USA. Meanwhile, new figures in the afternoon provide information about the American economic situation – so be sure to keep an eye on your regular market updates.

Dithering in Frankfurt

A little up, a little down – in early trading on Wednesday, the DAX first regained the 12,000 mark before giving back the bastion. The day before, the German leading index had recovered by around one percent after conciliatory words by Trump on the trade war with China. “If they want a deal, it’s absolutely possible,” he stressed.
Robust data from the German economy only caused little buying mood. Between January and March, the gross domestic product grew by 0.4 percent compared to the previous quarter, according to the Federal Statistical Office in Wiesbaden. In the fourth quarter of 2018, GDP had stagnated, and in the third quarter it had even fallen slightly. All data can be found here: Market Mover
In the reporting season, RWE temporarily moved to the top of the DAX on Wednesday after their first quarter was interpreted as solid.

Hope for state aid in Asia

In Asia, investors took action because they immediately interpreted negative Chinese economic data as an argument for new government stimuli. Both retail, industrial production and investment figures were disappointing. The question is how deep the pockets of the red emperors really are – and whether China can help its industry indefinitely if there really is a trade war with the US. The CSI 300 rose by 2.3 percent to 3,727 points. The Japanese Nikkei 225 closed 0.6 percent higher at 21,189 points.

Shrill sounds in China

Meanwhile, the Chinese leadership has sent its editorial offices to the front. The “Global Times” wrote that the USA fought for greed and arrogance – and the morale of the opponent would soon break. China is fighting to defend its legitimate interests. In an indirect appeal to boycott American goods, the paper also conjured up a “people’s war”. The Chinese television station CCTV reported that China was fighting for a “new world”. Well, yes.

Oil market intensifies

Although Donald Trump can by no means count on his media – on the contrary – he is very popular thanks to his hard line: with over 45 percent his approval is higher than it has been for two years. And what values does Europe represent? Appeasement. The Spanish have ordered their warship “Méndez Núñez” home from an American naval unit heading for the Persian Gulf. The mullahs in Tehran will certainly reward this. Meanwhile Saudi Arabia reported that two pumping stations of a larger Saudi pipeline were attacked yesterday by drones loaded with explosives. Although the damage is only minor, it can have political consequences. A television station of the Yemeni Houthi rebels supported by Iran claims the attack for themselves.

Optimism in New York

However, investors on Wall Street on Tuesday had ignored the threat of conflict with Iran and hoped for an amicable settlement between China and the US. At the closing bell, the Dow Jones recorded a gain of 0.8 percent to 25,532 points. The S&P 500 also climbed 0.8 percent to 2834 points. The technology-driven Nasdaq 100 gained around 1.1 percent to 7402 positions.

Fresh US data and Brexit launch in London

We are curious to see if the US economic data coming in this afternoon will underpin the renewed optimism. At 2.30 p.m. German time, retail sales will be reported in April, as will the Empire State Index for May, which provides information about the New York region’s economy. At 3.15 p.m. the Federal Reserve will provide figures on industrial production in April, i.e. capacity utilization. The weekly oil report is also due at 4.30 pm.
Traders in the British pound should also note the date for the next act in the exit drama: British Prime Minister Theresa May wants the House of Commons to vote on the Brexit agreement for the fourth time at the beginning of June.
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.

Frankfurt am Main

Little courage in Frankfurt

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14.05.2019 – Daily report. Following the share price storm on Monday, shares in Frankfurt have recently recovered slightly. Conciliatory tones from Washington in the customs dispute with China caused a subdued buying mood. In addition, investors analyzed fresh quarterly figures from Germany. Traders also kept an eye on the oil price.

Quarterly financial statements in Frankfurt

After the strong minus on Monday, German investors hesitantly stocked up on equities again. The DAX climbed slightly, but was still just under 12,000 points. However, the worse than expected ZEW Indicator of Economic Sentiment dampened the buying mood. All economic data can be found here: Market Mover
Fresh quarterly figures ran through the tickers. Allianz reported a surprisingly strong increase in profits at the beginning of the year. ThyssenKrupp showed no clear trend – the industrial and steel group had reported a loss for the second quarter. Merck reported somewhat weaker than expected quarterly figures. Bayer was under pressure: After another defeat in court in a US glyphosate lawsuit, the stock temporarily slipped to its lowest level since 2012. Bayer is to pay more than two billion dollars in damages.

Optimism in Washington

However, the decisive issue again was the customs dispute. Despite yesterday’s escalation in the customs dispute, US President Donald Trump spread optimism. He was confident that he would find a solution to the trade war with China. He announced a meeting with Chinese President Xi Jinping at the G20 summit in Osaka at the end of June. Furthermore, there was still no decision on a further round of US punitive tariffs on Chinese goods. US futures then rose moderately. At 2.30 p.m. German time, the American import and export prices will provide information on how US foreign trade is going today.

Sales strike in Asia

Investors in Asia were reassured little by Trump’s intervention, especially as the stock market digested bad news from China. In the People’s Republic, car sales in April were down 17.8 percent on the previous year, according to the manufacturers’ association CAAM. This was the tenth month with a minus in a row. Buyers are apparently waiting for government incentives to buy – or they fear an economic crisis as a result of the customs dispute with the USA. The Chinese CSI 300 lost 0.6 percent to 3,645 jobs. In Tokyo, the Nikkei also closed 0.6 percent lower at 21,067 points.

Crash in New York

On Monday, US indices marked their worst day since early January. The Dow Jones closed 2.4 percent lower at 25,324 points. The S&P 500 fell 2.4 percent to 2,811 points. High-tech stocks were hardest hit: the Nasdaq Composite fell by 3.4 percent to 7,647 points. Apple slipped almost six percent. The group needs China as a growth market and also suffered a defeat in a US antitrust case.

Oil in the focus of traders

Meanwhile, the oil market remains exciting. According to the Wall Street Journal, the USA blames Iran for the sabotage of four tankers off the coast of the United Arab Emirates. Meanwhile, Russia has sent mixed signals as to whether it wants to continue to participate in OPEC’s cut in production. Perhaps OPEC will comment on this when the cartel presents its monthly report at 1 p.m. German time. Otherwise the data on US crude oil stocks of the American Petroleum Institute are due at 10.30 p.m. German time.
The Bernstein Bank wishes you 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.

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