thereOn Wall Street, the sell-off mood prevailed on Tuesday. Economic concerns and doubts about the sustainability of the recent trade agreement with China have pushed the most important equity indices to almost 4%. To this was added the fear that Britain could effectively leave the European Union without an agreement. Investors separated in particular with technology stocks. They are considered particularly vulnerable to economic fluctuations.
The main index, Dow Jones Industrial, slipped 3.10 percent to 25.027.07 points. It was the biggest slide since October 10th. At the beginning of the week, the stock market had responded even more relieved that since January they forecast that US tariffs for Chinese goods worth $ 200 billion for the time being were suspended for 90 days. For the S & P 500 market index, it fell Tuesday by 3.24 percent to 2700.06 points less. The Nasdaq 100 technology index fell 3.78% to 6795.21 points.
Due to recent Wall Street sales, investors are withdrawing from the German stock market. The Dax lost to open 1.2 percent on Wednesday at 11,205 points. Stock traders say fears of recession are rampant among investors. In this context, cyclical stocks were among the losers.
The shares of the chemical company Covestro, chip maker Infineon and the ThyssenKrupp industrial group reached 2.3%. In the falling market vortex, Deutsche Bank's shares slipped by 2.4% and were at 7.87 euros as cheap as ever
Bad news from London
US President Donald Trump and Chinese President Xi Jinping had agreed this weekend that they would not intensify the trade dispute. "In reality, the two sides should only agree on the parameters for a future agreement and what should be included to extend the truce and promote the abolition of tariffs," wrote analyst Craig Erlam of the Oanda currency broker. However, according to his colleague Stephen Innes, now there is a bit of confusion after Larry Kudlow, Trump's adviser, struggled to find out when exactly China wanted to buy back fares on American cars.
London investors were also annoyed by bad news: a few hours before the start of the five-day debate on the Brexit agreement, the British parliament had inflicted a serious defeat on the government. The deputies decided that the government did not respect the rights of the parliament. This is another arrest for Prime Minister Theresa May. In any case, only minor opportunities will be granted to reach a majority for their agreement in the scheduled vote in Parliament on December 11th.
Investors also looked nervously at the bond market. For the first time in eleven years, yields on US three- and two-year bonds were higher than yields in the five-year maturity range. This structure with higher short-term rates than long-term rates is an unusual phenomenon and is considered a sign of recession.
The taillight was Caterpillar
The Dow lagged behind the cyclically sensitive actions of the Caterpillar construction machine manufacturer with a negative value of around 7%. Apple shares fell more than 4%. The UK investment bank HSBC had canceled the purchase recommendation for the iPhone manufacturer's documents, as short-term course drivers were missing. All other Dow values are also closed in the minus sign.
The dollar department store lowered earnings per share, missing the average estimate of analysts, dropping stock prices by almost 7%. A skeptical analyst study sent Fedex and UPS logistics companies in decline: they lost a good 6 or more of 7%. Investors underestimated the risks of competition from entering the Amazon online retailer's market in the cargo sector, he said.
Meanwhile, this Wednesday, Wall Street and Nasdaq will be closed in memory of former President George H. W. Bush, 41st President of the United States, who died on November 30th. The last euro was trading at $ 1.12342. The European Central Bank set the reference rate at 1.1490 (Monday: 1.1332) dollars. The dollar was worth 0.8765 (0.8825) euros. Leading 10-year government bonds earned 16/32 points at 101 27/32 points, achieving 2.910 percent.