Tuesday, 22 August 2017

What’s next? – DAX 22.08.17

Posted by Valentine at 10:46 Labels:

DAX

The DAX futures traded 0.82 percent lower at 12,069.0 points as of 05:30 GMT on Tuesday, extending previous session losses in the light of increasing geopolitical tensions.

As the United States and his regional ally South Korea began a new series of joint military drills, North Korean leader Kim Jong-un warned that such activity was a “reckless behavior driving the situation into the uncontrollable phase of a nuclear war.”

A week earlier, US Marine Corps General Dunford met with South Korea president Moon Jae-in to discuss Pyongyang’s continuous threats. Dunford reassured Washington’s position to supporting Seul against any kind of security threat, although he also said the Trump administration was actively looking for alternatives to resolve this conflict on a diplomatic way.

Higher geopolitical tensions involving the United States weigh on the dollar, which makes the euro stronger and therefore, key exporting countries such as Germany feel the pain.

On the data front today, the Centre for European Economic Research (ZEW) will release at 09:00 GMT its August readings on current conditions and economic sentiment for Germany. Analysts forecasted an 85.5 and 15.0 readings respectively.

In Frankfurt, the German benchmark ended 0.82 percent to the downside on Monday, with technology, chemicals and utilities pushing it lower.

The best performers of the session were Lufthansa, which added 0.60 percent to 20.860, followed by Vonovia, up 0.14 percent to 35.30 and Siemens easing 0.18 percent to 111.10.

The worst performers of the session were Thyssenkrupp, down 3.18 percent at 25.265, Deutsche Bank falling 2.41 percent to 13.760 and E.ON dropping 2.28 percent to 9.402.

From a technical perspective, attention is now placed at the 12,000 support. A break below that mark could open the doors to 11,950. However, current levels seem to be an interesting opportunity for traders to buy with a medium-term / long-term approach.

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