A couple of unpleasant revisions to the EU’s economic forecasts only added to the Tuesday’s sense of unease, the markets crumbling under the renewed trade tensions.
Though there is time for it to reduce its losses as it did on Monday evening, the Dow Jones was in a bad way after the bell. Dropping towards a one-month-plus low as it shed nearly 300 points, the index found little solace in the news that the US and China will continue trade talks later in the week. There have, after all, been a lot of meetings at this point, with little to show for it from a market-perspective.
Like its US compadres, the Eurozone indices looked increasingly sickly this Tuesday. With the EU slashing Germany’s 2019 growth forecasts from 1.1% to a measly 0.5%, the DAX dove 190 points, sinking to a 3-week low of 12110. The CAC, meanwhile, slipped under 5400 following a 1.4% slide, even with the French GDP estimates being revised from 0.8% to 1.3%.
It was a sign of the strength of the trade war fears that the FTSE plunged 1.5% – admittedly playing catch-up after yesterday’s Bank Holiday – despite the pound falling 0.4% against the dollar and 0.2% against the euro. Sterling’s issues stem from the cross-party Brexit talks; not only the chance of a Tory/Labour compromise being reached, but the likelihood of any deal then being backed by parliament.
Disclaimer: Spreadex provides an execution only service and the comments above do not constitute (or should not be construed as constituting) investment advice or recommendations, or a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any person placing trades based on their interpretations of the above comments does so entirely at their own risk. Spreadex Ltd is a financial and sports spread betting and sports fixed odds betting firm, which specialises in the personal service and credit area. Founded in 1999, Spreadex is recognised as one of the longest established spread betting firms in the industry with a strong reputation for its high level of customer service and account management.
In relation to spread betting, Spreadex Ltd is authorised and regulated by the Financial Conduct Authority. Spread betting carries a high level of risk to your capital and can result in losses larger than your initial stake/deposit. It may not be suitable for everyone, so please ensure you fully understand the risks involved.