Markets Update Tuesday 26/11/2019 – Oh so high

Oh so high

On Wall Street, indices continue to climb to new records – although investors there, as on other world markets, are becoming more breathless. Investors could remain in cover until concrete results are achieved in the trade dispute – as was the case on Tuesday.

The Chinese and US negotiators continued their talks about a partial solution in their year-long trade war on the phone. The Beijing meeting on Tuesday morning was attended by Deputy Prime Minister Liu He, US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin, as reported by Xinhua, the official news agency. Meanwhile, the US Congress’ bills to support the democracy movement in Hong Kong continue to cause discontent. China wants to use all its might to prevent US President Donald Trump from signing them. One day after the victory of the opposition Democrats in the local elections in China’s special administrative region, the State Department in Beijing appointed the US ambassador on Monday.

US Markets at a glance

The Dow Jones reached a new all-time high of 28,129.74 points on Tuesday. However, there were no significant leaps in the US benchmark index, which rose by 0.19 per cent to 28,120.80 points. The NASDAQ Composite tech index also set a new record – at its peak, it climbed to 8,659.73 points. In the end, the stock market barometer went 0.18 per cent firmer at a final score of 8,647.93 points in the evening.

On Monday, US Federal Reserve Chairman Jerome Powell was optimistic about the outlook for the world’s largest economy. However, the mood among US consumers deteriorated slightly in November. The corresponding barometer fell to 125.5 points from 126.1 points in October, according to the Conference Board research institute. Experts surveyed by Reuters had expected an increase. Consumers assessed their situation worse than recently, while their expectations were better. Private consumption accounts for around 70 per cent of US economic output.

Far East Markets at a glance

The majority of Asian stock markets rose on Tuesday.

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In Japan, the Nikkei closed 0.35 per cent higher at 23,373.32 points. On the Chinese mainland, the Shanghai Composite ultimately rose by just 0.03 per cent to 2,907.06 points, while the Hang Seng in Hong Kong fell 0.29 per cent to 26,913.92 points.

European Markets at a glance

The EuroSTOXX 50 started almost unchanged, fell back in the meantime, but finally moved around the zero line again. It dropped 0.06 per cent more easily out of trading at 3,705.55 points.

The German stock market took a breather on Tuesday. The DAX had started the day with little change, then fell more sharply into the loss zone, but was able to close the trading session at zero again. It said goodbye 0.08 per cent more easily at 13,236.42 points. In addition, the TecDAX gained more strongly, having only risen slightly at the start. At 3,066.14 points, it reached its highest level since 2000. The MDAX also recorded a new all-time high of 27,554.39 index points.

Once again, the market was dominated by the ongoing trade conflict. There was cautious optimism that China and the USA would soon agree on a partial agreement. However, tangible progress is lacking.

Forex, gold, oil and crypto

The calm in the trading dispute is also reflected in the currency market. The Euro did not move much on Tuesday. The common currency was traded at 1.1012 dollars at the close of trading in Frankfurt, almost the same level as in the morning. The European Central Bank (ECB) set the reference price at 1.1020 (Monday: 1.1008) dollars.

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Oil prices did not find a clear direction on Tuesday. Prices fluctuated around the previous day’s level. Most recently, a barrel of North Sea Brent cost 63.58 dollars. That was seven cents less than on Monday. The price for a barrel of the American variety West Texas Intermediate (WTI), on the other hand, rose slightly to 58.04 dollars. There was talk of a lack of impetus on the oil market. 

The gold price was trading sideways for most of the day but rose slightly to approximately $1,461 in the end. 

The cryptocurrency market stabilised on Tuesday as well after it came under enormous selling pressure in the last days. Bitcoin was able to recover by approximately 2.5 per cent compared to the previous day to $7,200. One Ethereum currently costs $149 and one XRP $0.2210. 

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Corporate and world news

Brazil’s central bank fights with intervention against the fall of the Real

As announced on Tuesday, the central bank sold the US dollar and intervened in trading for the first time in three months. The measure is intended to stop the fall of the Brazilian real.

Previously, the domestic currency had fallen to a new record low. Although the intervention of the central bank was surprisingly carried out for market participants, the measure was only able to curb the fall in the exchange rate for a short time. In the further course of the day, the downward slide of the real picked up speed again. At times, 4.2765 reals were paid for a dollar, more than ever before.

Although many Brazilian companies are benefiting from the weakness of the domestic currency because they are comparatively strongly focused on exports, they are still not able to keep up with the weakness of the euro. However, Brazil’s President Jair Bolsonaro has meanwhile contradicted his Economics Minister and expressed his concern about the weakness of the exchange rate.

GfK climate report

Consumers in Germany are going into the pre-Christmas period in a positive mood. In its monthly consumer climate index, the Nuremberg market research company GfK predicts a slight increase of 0.1 points to 9.7 points in December. This was announced by GfK in Nuremberg in the morning. In the previous month, the value had fallen by 0.2 points to 9.6 points.

Although the consumer climate was thus somewhat weaker than in the same period of the previous year, the German citizens assessed the economic development more positively than a month ago. 

DHL brings Streetscooter to America

The StreetScooter electric vehicle unit from Swiss Post subsidiary DHL will enter the US market next year. The zero-emission “Work L” delivery van will be used in two urban US markets from spring 2020, one on each coast, according to the companies. The area-wide deployment could be rolled out in 2022 and 2023, said Ulrich Stuhec, head of technology at StreetScooter. DHL rival United Parcel Service has around 1,000 electric and hybrid electric vehicles in its fleet, and FedEx announced last year that it would also deploy 1,000 electric vehicles in California. Los Angeles, London, Berlin, Tokyo and 30 other cities around the globe are working to establish emission-free zones by 2030.

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