Equity Market Handover Car shares lead Europes reversal

Stock market snapshot as of [24/6/2019 3:06 PM]

Wall Street, Asia-Pacific and European stock markets could be splitting along trade-war lines at the start of a week that will be crucial for deciding what happens next in Washington’s dispute with Beijing
The absence of confrontational rhetoric over the last fortnight ahead of G-20 talks between U.S. President Trump and China’s President Xi may have enabled a higher ceiling for sentiment. Nerves remain though
U.S. indices opened positively. Markets from Sydney to China itself saw a similar mood
The acrimonious collapse of a putative U.S.-China consensus in May is being somewhat offset by expected policy accommodation. Yet with a palpable sense of realism about what the two Presidents can achieve in two days, downside could be limited, regardless of the outcome
The U.S. dollar’s tumble through significant technical markers (e.g., the Dollar Index’s 200-day moving average) also cushions markets that benefit from cheaper dollar financing
Europe is not at this party though. A conspicuous move in the opposite direction is partly down to possible U.S. tariffs on EU cars that Donald Trump has toyed with for more than a year

Corporate News

A painful reminder of what’s at stake came with Daimler’s third profit warning in about six months. The impact is extending the underperformance of European car shares even further
Car makers are pressured from many sides, including by overcapacity, costs for righting alleged emissions wrongs, electric R&D and more. Monday’s fall suggests tariff-risks on top of those woes aren’t fully priced yet
Daimler has traded as much as 5% lower, whilst STOXX’s Automobiles index slumps over 1%. Utilities and staples rise as befits a need for safety
After Brent and WTI crude oil contracts advanced between 8% and 12% in just over a week, even oil shares are adrift as the black stuff takes a rest, despite the lack of let-up in Iran-U.S. tensions
Treasurys join gold in rallying with U.S. shares, whilst the yen is only offside as it consolidates another percentage point gain against the dollar so far in June. The everything rally looks increasingly unsustainable
U.S. pharma giant Bristol-Myers Squibb, misses out for now. It slides 4% after filing for EU approval to take over biopharma Celgene for $74bn. European regulators have indicated oversight isn’t being fast-tracked. Celgene also falls 4%

Upcoming corporate highlights

BMO: before market open AMC: after market close

Upcoming economic highlights

From time to time, StoneX Financial Pty Ltd (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.

As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.

City Index is a trading name of StoneX Financial Pty Ltd.

The material provided herein is general in nature and does not take into account your objectives, financial situation or needs.

While every care has been taken in preparing this material, we do not provide any representation or warranty (express or implied) with respect to its completeness or accuracy. This is not an invitation or an offer to invest nor is it a recommendation to buy or sell investments.

StoneX recommends you to seek independent financial and legal advice before making any financial investment decision. Trading CFDs and FX on margin carries a higher level of risk, and may not be suitable for all investors. The possibility exists that you could lose more than your initial investment further CFD investors do not own or have any rights to the underlying assets.

It is important you consider our Financial Services Guide and Product Disclosure Statement (PDS) available at www.cityindex.com/en-au/terms-and-policies/, before deciding to acquire or hold our products. As a part of our market risk management, we may take the opposite side of your trade. Our Target Market Determination (TMD) is also available at www.cityindex.com/en-au/terms-and-policies/.

StoneX Financial Pty Ltd, Suite 28.01, 264 George Street, Sydney, NSW 2000 (ACN 141 774 727, AFSL 345646) is the CFD issuer and our products are traded off exchange.