Archives of “December 2019” month

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European shares end the day with gains

  
Analysis, Global Indices

German DAX up 0.8% UK FTSE up 0.1%

The major European indices are ending the day with mostly decent gains. The exception is the FTSE 100 which rose by about 0.1%.
Provisional closes are showing:
  • German DAX, +0.8%
  • France’s CAC, +0.8%
  • UK FTSE 100, +0.1%
  • Spain’s Ibex, +0.6%
  • Italy’s FTSE MIB, +1.2%

For the week the major indices are also closing higher:

  • German DAX, +0.27%
  • France’s CAC, +1.7%
  • UK’s FTSE 100, +3.0%
  • Spain’s Ibex, +1%
  • Italy’s FTSE MIB, +2.8%

US Markets :More record highs for the major indices

  
Analysis, US Market

Record closes and all time intraday highs too

More record highs for the major indices, with the major indices closing near the all time intraday highs too.
The final numbers are showing:
  • S&P index +14.13 points or 0.44% at 3205.27. That is just off the all-time high at 3205.48
  • Nasdaq index +59.485 points or 0.67% at 8887.219. That is just off its all-time high of 8888.125
  • Dow is up 137.54 points or 0.49% at 28376.83. That is just off ITS all-time high of 28381.48.
Some winners today include:
  • Netflix, +3.67%
  • Tesla, +2.80%
  • Micron, +2.73%
  • Cisco, +2.70%
  • Nvidia, +2.65%
  • Box, +2.09%
  • Facebook, +1.82%
  • 3M, +1.77%
  • J&J, +1.49%
  • Intel, +1.38%
Some of the losers include
  • Lyft, -1.6%
  • Caterpillar, -1.49%
  • Square, -0.98%
  • Exxon Mobil, -0.70%
  • J.P. Morgan, -0.51%
  • Bank of America, -0.4%
  • Chevron, -0.39%
  • Goldman Sachs, -0.22%
  • Verizon -0.13%
  • Disney, -0 point

Stanley Druckenmiller is wading into the global reflation trade in 2020

  
  Analysis

What the investing legend is doing in 2020

What the investing legend is doing in 2020
Stanley Druckenmiller says he was ‘timid’ in 2019 but still eeked out a double-digit return while relying on safer assets.
“I’m just too conservative in my old age,” he said. “I was well positioned but just too timid.”
His wagers for 2020 are on the Canadian and Australian dollars while shorting the yen and Treasuries. He also owns copper and equities from the US and Japan.
More recently, he bought the pound and UK banks. He said Brexit will ultimately be good for the UK economy.
Early in the year he reversed positions he had taken in late 2018 when he bought bonds, bet against financials and predicted a period of low returns.
“I couldn’t have been more wrong,” he said.
The main risks he sees are political, a turn in inflation that forces the Fed to hike and weakening credit. He said he doesn’t see any of that happening in the near term but “these things tend to happen after elections.”
I highly encourage everyone to watch the full video (50 mins) because he makes many compelling points.

China: Phase One trade deal content to be disclosed after the deal is signed

  
  Analysis
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Comments by the Chinese commerce ministry

  • US, China trade teams are maintaining close communications on signing of the deal
  • No new information on talks with the US at the moment
What’s that saying again? Oh, right. Nothing is agreed until everything is agreed.
There’s no doubt that both the US and China have made great strides to get towards a Phase One deal but until it is officially signed off, there is still the fear that it could all fall apart – especially when there is the seemingly lack of details about the deal currently.
That said, I would still expect the deal to get through without any major hitches in the coming weeks. However, once again, this will just represent a temporary trade truce in what will be a prolonged war between US and China that can last up to many more years to come.

Chinese commerce ministry refrains from confirming if trade deal will be signed in January

  
  Analysis

China continues to keep mum over the trade situation in general

Trump Xi

No details up on offer and no real confirmation by the Chinese side on how things are progressing. That hardly is surprising as this has been the case time and time again as far as US-China trade talks are concerned.

As mentioned earlier, there is still good reason to believe that both sides can sign off on the deal in the coming weeks but the lack of enthusiasm from China is a subtle reminder that nothing is ever agreed until everything is agreed.

Nikkei 225 closes lower by 0.29% at 23,864.85

  
Analysis, Global Indices

Asian equities a little lower on more skittish sentiment

Nikkei 19-12

Japanese stocks continued to retreat on the week as investors continue to stay more cautious amid fading trade optimism with little else to go on in the new year.

The only notable news in the morning is Trump being impeached but it hardly is worth anything with the Senate surely to shoot down the case voted on by the Lower House earlier.
The Hang Seng is down by 0.5% while the Shanghai Composite is down by 0.2% amid more lackluster trading sentiment on the day.
The overall risk mood remains more modest though with US futures keeping flat with little change observed in bond yields. As such, USD/JPY is keeping in a narrow 15 pips range and resting at 109.57 currently to start the European morning.

Recap: Trump impeachment story, where are we now?

  
  Analysis
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The Lower House has voted in favour to impeach US president Trump on two accounts earlier today

Trump

 

He is certainly not having a good day but it isn’t the end of the world for Trump, not even close in fact. The House of Representatives (Lower House) may have voted to impeach him on the two accounts above but it will not happen unless Senate also votes similarly.
And to that note, it is extremely unlikely to happen especially since the Republicans still hold a majority there and 2/3 votes are needed for the impeachment charges to succeed.
If you’re wondering why markets aren’t reacting to the news, that is the main reason why. Greg also gave a bit of an overview of the situation yesterday here.
The Democrats themselves know how this can all play out in the new year, which is leading to the suggestion that they may just prolong the process of passing things over to Congress – in hopes that the impeachment news will brew and bubble up among the public.
That said, it shouldn’t make much difference to markets unless this spills over to damage Trump’s election chances – which is also seen as unlikely at this stage.
So in short, Trump is one step closer to actually being impeached but it is almost certainly still not going to happen. As you were..
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