ActivTrades’ Market Analysts have prepared for LeapRate their daily commentary on traditional markets for November 4, 2019. See details below:
FOREX
The euro is on the backfoot as Europe’s Monday session gets underway with it down by more than 0.1% against both the dollar and the pound. Investors will be listening closely to Christine Lagarde’s speech later today. The new head of the ECB has already given signs that her stance will be aligned with that of her predecessor, Mario Draghi. Ms Lagarde criticised Germany and the Netherlands, both countries with large budget surpluses, for not investing enough at a time of weak growth. These divisions within the European camp will not be beneficial for the single currency, which is already under strain from trade uncertainty and disappointing growth.
Ricardo Evangelista – Senior Analyst, ActivTrades
EUROPEAN SHARES
The optimistic wind which boosted risk appetite over the last few weeks has continued into November with all EU benchmarks trading higher this morning, following a solid trend registered overnight by Asian markets. The US-China trade talks remain the main driver on stocks with this asset class on course for a fifth straight week of gains as the two blocs edge closer to an interim deal in November. Investors welcomed the significant recent progress on intellectual property theft issues, even though this topic hasn’t been entirely solved yet (some issues may slip to the phase 2 of the deal).
A new venue is still to be agreed for a November US-China meeting with President Trump wanting the interim deal to be signed somewhere on US territory. In the meantime investors will keep an eye on US durable goods release today as well as Chinese trade balance and CPI data due at the end of the week to gauge the positive impact of the trade dispute resolution on both economies. We believe optimism surrounding the trade dispute is likely to keep on supporting stock prices around the globe this week, especially if US and Chinese data is in line with or continues to beat expectations like last week’s solid NFP reports.
Pierre Veyret– Technical analyst, ActivTrades
DAX
The German DAX-30 Index is one of the best performers in the Eurozone currently with 9 out of its 11 sectors trading higher. Commerzbank’s price surged following Polish state companies bid to buy mBank. The bank’s share price cleared the 5.635EUR resistance in the immediate aftermath of the news, and now faces the strong 5.70EUR zone if it is climb higher. However, uncertainty over who will be allowed to make the final offer remains with mBank already specifying in a note that it will prefer an investor with no presence in Poland.
Elsewhere, Siemens Healthineers is also moving strongly today after both sales and annual growth beat estimates. The company’s share price rose by 8.1%, trading above 41EUR this morning before retracing part of its gains towards 40.10EUR.
The DAX-30 index is now trading well above the 13,000pts zone, its highest since June 2018, with the next resistance found at 13,195pts and then 13,465pts.
DAX-30 index chart
Pierre Veyret– Technical analyst, ActivTrades