Archives of “June 28, 2019” day

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European shares end the day with gains. How did you do?

  
Analysis, Global Indices

German Dax up 1%. UK FTSE up 0.7%

The major indices in Europe are ending the day higher.
The provisional closes are showing:
  • German Dax, up 1.09%
  • France’s CAC up 0.93%
  • UK FTSE up 0.43%
  • Spain’s Ibex up 0.56%
  • Italy’s FTSE MIB up 0.59%
Not only is it end of day, but also the end of week, end of month and 2Q. How did the major European indices perform in the month, quarter, and might as well add the year too.
For the week,
  • German DAX, +0.48%
  • France’s CAC, +0.2%
  • UK’s FTSE, +0.24%
  • Spain’s Ibex, -0.3%
  • Italy’s FTSE MIB, -0.72%
For the month, the major European shares have solid gains:
  • German DAX, +5.7%
  •  France’s CAC, +6.3%
  • UK’s FTSE, +3.7%
  • Spain’s Ibex, +2.3%
  • Italy’s FTSE MIB, +7.2%
It is quarter end. the indices were higher with the exception of Spain and Italy which declined modestly
  • German DAX, +7.57%
  • France’s CAC, +3.52%
  • UK’s FTSE, +2.0%
  • Spain’s Ibex, -0.4%
  • Italy’s FTSE MIB, -0.2%
Finally, for the year, the YTD numbers are showing solid gains:
  • Germany’s DAX, +17.42%
  • France’s, +17.09%
  • UK’s FTSE, +10.37%
  • Spain’s Ibex, +7.72%
  • Italy’s FTSE MIB, +15.88%
How does the YTD compare to the US?
  • Dow, up 14.01%
  • S&P up 17.1%
  • Nasdaq +20.54.
I can’t say my returns have been as stellar, but I gotta think that there are a lot of people, who may be underinvested in equities this year.  As a result, if not all-in, that likely lessens the returns relative to the averages.
Am I right? How are you doing?

It isn’t just about the Trump-Xi meeting this weekend

  
  Analysis

European leaders will meet on Sunday to discuss on who will take over the bloc’s top jobs in the coming months

ECB

The European Council failed to reach a majority in the first round of meeting on 20 June and are set to meet again on Sunday for more talks over who will take on the presidencies of the European Commission, European Parliament, and European Central Bank.

If the bloc’s members are able to sort out the first two positions, you’d have to figure they’ll also be able to work out who will succeed Draghi later in October (given how these things are politically schemed).
As such, we could find out who will be the next ECB president over the weekend or if the council fails to reach a majority again, the process will drag on further. Regardless, it’s best to be prepared in any case should they be able to work something out.
Among the major candidates in the running for the ECB presidency are:
  • Jens Weidmann (Bundesbank president)
  • Benoit Coeure (ECB governing council member)
  • Francois Villeroy de Galhau (Bank of France governor)
  • Olli Rehn (Finnish central bank governor)
  • Erkki Liikanen (Former Finnish central bank governor)
There’s also the possibility we’ll see the likes of Klaas Knot (Dutch central bank governor) and Ardo Hansson (former Estonian central bank governor) in the mix but I reckon at the end of the day, it’ll be a trade-off between France and Germany for the European Commission presidency and the ECB presidency. Talk about “fair game”, eh?

Russia’s Novak says G20 may offer more clarity to OPEC+ before meeting next week

  
Analysis, Crude

Comments by Russian energy minister, Alexander Novak

In his words:

“The market is currently in a very interesting phase. On one hand, it seems balanced in terms of supply and demand. But on the other hand, there are so many uncertainties. We hope that there will be more clarity and more visibility after the G20 summit in Osaka.”

Adding that he expects oil producers to take a ‘balanced decision’ when they meet on 1-2 July next week. If anything else, this doesn’t sound like someone who is particularly prepared to continue with the current production cuts deal – not like they were contributing much to it in the first place anyway.

How will the Fed react if US and China reach a trade truce this weekend?

  
Analysis, Economy, Global Indices
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A trade truce between US and China will be good for risk assets but does that mean the Fed will shelve its rate cut plans?

WIRP US 28-06

Although risk assets will steal the focus in the aftermath of the Trump-Xi meeting tomorrow, the dollar and the Fed are likely to be the more talked about topics in the coming weeks with the next FOMC meeting scheduled for 31 July.
A 25 bps rate cut is all but a given at this point but markets are still seeing a 22% probability that the Fed may cut rates by 50 bps, according to Fed fund futures.
But if US and China are able to achieve a trade truce this weekend, which I reckon they will find some form of agreement to resume talks at the very least, it puts the Fed in an interesting spot ahead of their July meeting.
Final Q1 GDP data yesterday gave little concerns for the Fed to be immediately cutting rates and the revised uptick in PCE is also a welcome sign on the inflation front. And if trade talks find some limited progress in the near-term, it’ll be very interesting to see how they would phrase their decision in cutting rates in July.

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Nikkei 225 closes lower by 0.29% at 21,275.92

  
Analysis, Global Indices

Tokyo’s main index falls as Asian equities drop ahead of the Trump-Xi meeting

Nikkei 28-06

Asian stocks are displaying more cautious sentiment to wrap up the week, with the focus in markets today being solely on the Trump-Xi meeting that will take place tomorrow. Chinese equities are down by nearly 1% but I reckon month-end flows may have something to do with that – some light profit taking before tomorrow.

For the month of June, the Nikkei ends 3.3% higher while the Hang Seng index is currently up by 5.7% and the CSI 300 index is posting gains of 5.0%.
As for trading sentiment today, the risk mood is much more measured and flat with US and European futures near unchanged levels as we begin the session. USD/JPY sits a little lower at 107.70 now but it’s not really saying much about direction to start the day.

10 Trading Wisdom points

  
Analysis, Education
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(1) Any strategy you build will be determined by your beliefs about the market and the objectives you’re trying to achieve. Therefore, your beliefs and objectives are the starting point of the system design and build process and it’s from these you will determine your Key Idea.

(2) Therefore, your Key Idea is your working hypothesis or your explanation of what the foundations of your system are and how it will work.

(3) One of the most famous Key Idea’s was declared by the Turtle Traders, specifically Richard Dennis. Being trend traders they acknowledged that every trend, without fail, was preceded by a breakout.

(4) From that start point they used a standard channel breakout to enter and they also had what they called a ‘fail safe’ breakout entry which absolutely guaranteed they’d capture every new trend.

(5) The Key Idea of Warren Buffett is that you should buy a great company at a cheap price. From this Key Idea he built specific rules and guidelines about how to actually go about doing that.

(6) The Beliefs of many of the worlds great traders can be found in various texts, such as the Market Wizards series by Jack Schwager. Examples: – Markets only trends 30% of the time – The big money is made in the big trends – Buying value is a safe strategy – Stops get hunted

(7) Your objectives are also very important in the design process. In many instances I often hear, “I want to make as much money as possible”. Well, we all do, but that’s a very one dimensional view of the world and of the process of designing a trading system.

(8) Indeed, there is much research to suggest extremely successful traders view profits as a by-product and not the main goal. Many successful traders are passionate about the markets and it’s that passion, not the want of profits, that enable them to succeed.

(9) Taking a more holistic view, objectives encompass many other dimensions, such as your personal risk tolerance and your lifestyle factors. If you’re a family man & has system that requires you to sit in front of a screen for 15-hours a day, it’s probably not a realistic goal.

(10) So your objectives must be broader than just profitability. They must be aligned with your Beliefs. They must be aligned with realistic expectations and they must be aligned with your lifestyle.

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