6 February, 2017
The DAX started the week with a fall of 100 points that was quickly corrected. Currently the index a bit higher on the day and the first drop should be associeted with the political news.
The first wave of selling came after Federica Mogherini’s speech on the situation on Ukraine. Let us recall that in 2014 the Russian invasion on Ukraine led to a nervousness on global markets. Today, EU foreign-policy chief said that the situation in Ukraine has deteriorated significantly in the last days. That means that the topic may be back on the table in upcoming weeks and may have an impact on global markets.
Another hit came from the Italian banks. Stocks from this sectore fell across the board. Investors also prepare for a busy week of corporate earnings and sift through the differing policy ambitions of U.S. President Donald Trump.
On the data fron, German engineering orders were down 15% on y/y basis. However, the union VDMA is putting a positive spin on it by saying the falls were to be expected given the global political uncertainties i.e. potential US trade issues. The US accounts for around 10% of German engineering export market. Earlier today a better report on factory orders was published (+5.2% m/m vs. 0.7% expected).
DAX rose after 2 hours of trading despite a sharp drop at the start of the session. source: Bloomberg
Later today we will hear from Mario Draghi, who will appear in the European Parliament. His speeach will be followed by a question-and-answer session.
Looking at the chart we may notice that the index failed to break below the upper bound of the upward channel that was broken at the end of 2016. That means that a move lower should be limited. Unless 11400 holds, the medium-term scenario remains bullish.
DAX remains above the broken channel, more gains should follow. source: xStation 5
Company news: German steel conglomerate ThyssenKrupp has invested around €35 million into a new production unit for automotive springs and stabilisers in Hungary, the company said on Friday
Baker Hughes report for the last week has showed another rise of US oil producers activity. The number of active rig counts rose by 8 w/w which obviously favours the further rebound of supply on the market...
European stocks are trading higher today due to a general risk-on triggered by Donald Trump. He commented on deregulation and corporate tax cuts and commited to introducing a plan in 2-3 weeks which was more than enough for US stocks to surge towards new record highs...
The sentiment on European equities is very cautious, but the main indices remain slightly above zero today. The Dax made an attempt in the morning to shake off its recent weakness, but upward move faded within one hour...
Bank remains short EURCHF targeting 1.02, Deutsche says that if speculators also upped the pressure, continued intervention would become ever costlier...
Stock markets have started out in a defensive mode this morning with the FTSE 100 falling more than 60 points. Donald Trump is in the headlines once more as his latest executive order signed late on Friday has caused a furore around the globe...
The overnight trading results in a continuation of the US dollar gains. A broad based recovery of the US currency is what has been missing yesterday morning to call the market behavior a proper return of the Trump trade...
This morning saw the release of data which shows that the UK economy grew faster than expected in the final quarter of 2016. The pound is higher on the day but has seen some weakness since the release, perhaps due to some traders seeing this as a good opportunity to book some profits after a strong run higher in the past couple of weeks...
After a closing bell on Wall Street, API issued a weekly report on Crude Oil inventories in the US. The report is pretty bearish for oil. Inventories rose by 2.93mln bbl with expectations at 2.5mln. If the data is confirmed it will be the 3 consecutive week of growth...
So this is how Donald Trump first day in office looks like. He has easily made it to the headlines, In his first executive orders he confirmed that NAFTA will be renegotiated and that the US no longer applies for the TPP...