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Frankfurt – 21/09/2021
After the sell-off at the start of the week, the stock markets stabilised today. Some investors took the opportunity to enter and went “bargain hunting”. But the calm could prove to be deceptive because the Evergrande fiasco and the upcoming Fed meeting could again harbour risks.
In New York and in Frankfurt, where the new DAX 40 was able to make its first daily gain since its inception, investors put aside concerns about a widening of the crisis at real estate giant Evergrande – at least for the time being. After the heavy losses of the previous day, the situation on the global stock markets has largely eased today.
US Markets at a glance
Wall Street stabilised slightly today, but it was not all sunshine. The Dow Jones opened the session above the zero lines and mainly remained in positive territory. In the end, however, the US benchmark index lost 0.15 per cent to 33,919.84 points. The NASDAQ Composite also moved in green territory. It started the week well up and ended 0.22 per cent higher at 14,746.40 points.
At the start of the week, the crisis surrounding the Chinese real estate group Evergrande had fuelled sales. But some market experts spoke of an “overreaction” and technically driven selling in an environment of low liquidity.
US economic data, meanwhile, surprised on the upside: the US current account deficit rose less than analysts expected in the second quarter from the previous quarter, while the number of new housing starts increased more than expected.
Far East Markets at a glance
The Asian stock markets went in different directions on Tuesday. In Japan, the Nikkei index lost 2.16 per cent after returning from yesterday’s holiday break and ended the day at 29,839.71 points. On the Chinese mainland, trading also paused on Tuesday due to a holiday. On Friday, the Shanghai Composite closed 0.19 per cent firmer at 3,613.97 units. Hong Kong’s Hang Seng ultimately rose 0.51 per cent to 24,221.54 units on Tuesday, after heavy losses on Monday.
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Weak cues from the US and lingering concerns over property group Evergrande weighed on the region’s bourses. Investors also looked ahead to the US Federal Reserve meeting, whose results will be published in midweek. Here, the Fed could give more precise indications as to when a reduction in monthly bond purchases (tapering) is to be expected.
European Markets at a glance
On Tuesday, the European stock exchanges moved into the profit zone. The EuroSTOXX 50 trended on green terrain at the start of trading and subsequently extended its gains strongly. By the end of the session, it had climbed by 1.33 per cent to 4,097.51 index units.
The leading German index was also able to make up some of its previous day’s losses. The DAX opened higher and continued to appreciate as the day progressed. By the end of trading, it had gained 1.43 per cent to 15,348.53 points. The TecDAX was friendly at the start and then also continued to rise. In the end, an increase of 2.07 per cent to 3,907.37 points was on the board.
After the German benchmark index had come under heavy pressure on its first day of trading with 40 stocks, it went up again on Tuesday.
Investors in Europe focused on the statements of high-ranking central bankers. In addition, investors centred their attention on US economic data with figures from the US real estate market and foreign trade. According to some market participants, a possible default by the Chinese real estate company Evergrande remains a factor of uncertainty.
Forex, gold, oil and crypto
The improved mood on the stock markets had initially provided a friendly environment for the euro. However, after surprisingly strong data from the US construction industry, it gave up the gains. In New York trading, the common currency euro ultimately cost 1.1725 dollars on the foreign exchange market.
Oil prices fell again today after their slide the previous day and an interim recovery. After initially recovering some of their losses, a barrel of Brent crude cost 73.77 US dollars in the afternoon, 15 cents less than the previous day. The price of US West Texas Intermediate (WTI) fell by 10 cents to 70.19 dollars.
On the other hand, the gold price recovered further and closed the day up to $11 at $1,774 per troy ounce.
Cryptocurrencies continued their downward trend, and all digital assets were in the red. Bitcoin dropped a further 2.1 per cent to $40,700, while Ethereum fell 4.3 per cent to $2,767. XRP and Cardano (ADA) declined by 2 per cent to $0.89 and $2, respectively, while Solana took a sharper dive of 6.8 per cent to $123. The only cryptocurrency showing positive signs was Avalanche, retracing 7.4 per cent up to $59.
Corporate and world economic news
The deficit in the US current account increased slightly in the second quarter of 2021. According to preliminary calculations, the deficit was $190.28 billion. Economists surveyed by Dow Jones Newswires had expected a liability balance of $190.60 billion. As reported by the US Department of Commerce, the deficit in the first quarter was revised downwards to 189.42 billion dollars, after a minus of 195.74 billion dollars had initially been cited.
The development of the US construction industry was a positive surprise in August. While the number of new housing starts rose more strongly than expected, the number of building permits also increased surprisingly and significantly. Housing starts climbed by 3.9 per cent month-on-month, as the Commerce Department announced in Washington on Tuesday. Analysts had predicted an average increase of only 1.0 per cent. In addition, the previous month’s decline of 6.2 per cent was smaller than initially calculated. Building permits, which precede housing starts, rose by 6.0 per cent. Analysts, however, had expected a decline of 1.8 per cent. In July, permits had still risen by a slightly downwardly revised 2.3 per cent.
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