ActivTrades’ Market Analysts have prepared for LeapRate their daily commentary on traditional markets for November 12, 2019. This is not a trading advice. See details below:
FOREX/BREXIT
The pound gained almost 0.5% against the US dollar yesterday following the Brexit party’s decision to not divide the leave vote, standing aside in constituencies where the Conservatives are likely to win. This is good news for Boris Johnson as he’s now more likely to obtain the majority required to approve his EU exit deal.
The markets reacted positively, as such a scenario will finally bring to an end the prolonged uncertainty that, to some extent, has paralysed the British economy over the last three and a half years.
However, today the pound has shed around half of yesterday’s gains as even though a Conservative majority is now more likely, nothing is guaranteed and the upcoming election may yet provide a surprise result, with many marginal seats still up for grabs.
Ricardo Evangelista – Senior Analyst, ActivTrades
GOLD
Gold price has plummeted with four negative sessions in a row, which has pulled down the price to $1,450. Bullion was heavily sold on growing expectations of a trading deal between the US and China and also due to the strengthening of the greenback. Moreover, after a relative long lateral phase between $1,480 and $1,515, the breakdown of the support level of $1,480 has trigged some profit taking, with investors willing to bring home gains achieved in the first part of the year after this correction. We are also seeing some outflows from the ETF sector.
Carlo Alberto De Casa – Chief analyst, ActivTrades
EUROPEAN SHARES
European stocks keep on consolidating as benchmarks opened mixed in the region. This neutral market sentiment is in place as most investors await fresh news from the highly anticipated US-China “phase one” deal. In addition, traders are still gauging the effects the situation in Hong-Kong could have on the negotiation between the two blocs as most operators fear that a firmer position from China could interfere in trade talks with the US.
Furthermore, the current market corrections can also be explained by growing fear of a slowdown in negotiations following mixed signals from Washington (tariffs cancellation) as well as multiple delays towards the next formal meeting with Beijing. While waiting for trade developments, investors who have already anticipated the “phase one” deal may switch their focus back to data this week with both US and China Retail Sales in sight (Thursday and Friday).
Pierre Veyret– Technical analyst, ActivTrades
DAX-30
The DAX-30 index opened mixed this morning, just like most European indices. The market is trading above 12,200pts after bull traders defended the 13,190pts zone in early trading moves. The short-term bullish trend isn’t threatened yet, despite the recent consolidation phase, as prices remain inside their bullish channel so far. The best performers are in the industrial sector with Infineon Technologies trading 6% higher following a strong 4Q report which beat estimates.
The company’s share price went flying after the recent report showed a 4Q segment result margin of 15.1% (vs 14.4% expected) as well as an anticipation of 5% revenue growth for 2020, which strongly revived investors’ risk appetite towards the company.
Elsewhere, a similar situation has been observed on Deutsche Post after the company reported a 3Q EBIT of EU942M, which topped the highest estimations. In addition, investors welcomed the announcement made by CFO Melanie Kreis who said 3Q was good and progress towards the company’s full-year 2019 targets have been made.
Pierre Veyret– Technical analyst, ActivTrades