While the DAX is going downhill on the Frankfurt Stock Exchange, worries about a second corona wave are also growing on Wall Street. The worsening US election campaign is also depressing the mood and the courses. The losers of the day include natural resources companies and the banking sector.
Wall Street made heavy losses at the start of the week, but closed significantly recovered from its daily lows. Of the Dow Jones-Index fell by 1.8 percent to 27,148 points, the daily low the index was listed at 26,715 points. Of the S&P 500 lost 1.2 percent. It held up much better Nasdaq Composite with a minus of 0.1 percent. The Nasdaq composite even made the turn in the plus and went 0.4 percent higher from trading. However, the Nasdaq indices had already posted above-average losses in the previous sessions, so that the first occasional buyers ventured into the market again.
On this day, which hardly knew any winners, banking stocks and stocks of energy and raw materials companies were the weakest sectors. The former were weighed down by reports of failures to combat money laundering, the other two by falling prices for oil, gas and other commodities.
US election campaign unsettles investors
In view of the rising number of corona infections worldwide, investors were increasingly concerned about the global economy. A new wave of pandemics and new lockdowns could endanger the already sluggish recovery, it said. The ongoing tension between Beijing and Washington also depressed mood.
In addition, the increasingly fierce US presidential election campaign unsettled investors. An agreement between Republicans and Democrats on a new government stimulus package should be made considerably more difficult. And the question of the succession of the late constitutional judge Ruth Bader Ginsburg, which is now in the room, should deepen the rifts even further. US President Donald Trump wants to push through a new appointment before the election in around six weeks, but is facing resistance even within his own ranks.
Meanwhile, economic activity in the USA continued to weaken in August. Of the Chicago Fed Index fell to plus 0.79 from a revised level of plus 2.54 in July.
Walmart sole course winner in the Dow
Won among the individual values Oracle 1.8 percent. At the weekend, US President Trump agreed in principle to an agreement with which the video platform Tiktok of the Chinese company Bytedance wants to enter into a partnership with Oracle and Walmart. The Walmart-Share advanced 1.3 percent and was the only price winner in the Dow.
Nikola buckled by 19.3 percent. The founder and chairman of the US electric truck manufacturer draws the conclusions from allegations of fraud against the company. The Board of Directors has accepted his offer to step down as Executive Chairman and as a member of the Board. Stephen Girsky, formerly Vice-Chairman at General Motors, will be the new Chairman. Short-seller Hindenburg Research accused Nikola of fraud shortly after the company announced a multi-billion dollar collaboration with General Motors. The GM stock yielded 4.8 percent.
In the wake of the rapidly falling oil prices, energy values lost an average of 3.3 percent, while the raw materials sector fell by 3.4 percent. Economic worries depressed the industrial sector by 3.4 percent. Bank stocks posted losses averaging 3.3 percent. Documents from a US Treasury Department data breach reportedly reveal a problematic role banks play in combating money laundering. In spite of strict rules, many banks have done business with high-risk customers over the years and sometimes reported processes only hesitantly and with delay.
In addition to JP Morgan, Deutsche Bank and HSBC were also mentioned. JP Morgan lost 3.1 percent. Citigroup and Goldman Sachs stocks were down 2.1 and 0.4 percent, respectively. The only winners among the sectors were technology stocks. The Dow recovered Apple by 3.1 percent, Microsoft by 1.1 percent and Salesforce.com by 0.9 percent.
US Treasuries in Demand
In view of the uncertainties in the market, the dollar was firmer on the currency market. The greenback lived up to its reputation as a supposedly safe currency haven. The dollar index rose 0.6 percent. The euro slid below the $ 1.18 mark and was around 1.1770 in late US trade. On Friday evening it was still trading at 1.1863. With fears of a lockdown in Great Britain, the pound was under selling pressure. Against the dollar there was 0.9 percent to 1.2810 dollars.
The gold price came back with the stronger dollar. The Troy ounce was down 2.0 percent to $ 1,911, but was down to $ 1,882 during the day.
With heightened economic worries and the stronger dollar, oil prices fell significantly. There was also concern in the market that Libya would return to the markets, which would further increase global oil supply. The price for a barrel of the grade WTI fell 4.4 percent to $ 39.31, Brent was 4.0 percent to $ 41.44. US Treasuries were in demand among market participants due to the considerable uncertainty. With prices rising, the ten-year yield fell by 2.9 basis points to 0.67 percent.
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