- MarketPulse - https://www.marketpulse.com -

DAX Dips Lower as no Breakthrough Over Brexit

The DAX index has losses on Tuesday, erasing the small gains seen on Monday. Currently, the DAX is at 13,000.00, down 0.45% on the day. On the release front, German Final Services PMI edged lower to 54.3, short of the forecast of 54.9 points. Eurozone Final Services improved to 56.2, matching the forecast. On Wednesday, Germany releases Factory Orders and the Eurozone publishes Retail PMI.

Talks between Britain and the European Union appear to be back on track, after Prime Minister May essentially agreed to Europe’s demands over the Brexit bill, which could reach up to EUR 50 billion. Still, a breakthrough on the non-trade issues has been elusive. There were hopes that a breakthrough would be announced on Monday, following talks between Prime Minister May and European Commission President Jean-Claude Juckner, but the gaps on two issues remain, for now. One thorny issue is that of northern Ireland and its border. The UK will clearly not remain in a customs union with the EU, but Ireland is insistent that there not be a hard border with the North, while the DUP, which is propping up the May government, is strongly against any border between the UK mainland and Northern Ireland. The second issue is whether the European Court of Justice will have a role protecting European citizens in the UK. The EU is in favor of a role for the court, while many British lawmakers feel that such a move would impinge on British sovereignty. The EU holds a meeting on December 12, and May is anxious to wrap up the non-trade sticking points and move on to trade talks by that date.

Europe Lower Ahead of PMIs as Brexit Talks Stall [1]

The DAX continues to enjoy the view around the symbolic 13,000 level, as global stock markets have been fueled by the quick progress of tax reform legislation in the US. The Senate passed a tax reform bill on the weekend, but the vote was a squeaker, 51-49, as the vote went along party lines, with one Republican voting against the bill. Now that that the House and the Senate have passed tax bills, a conference committee will try and hammer out a uniform bill which can be sent to President Trump and signed into law. If the bill does become law, it will mark the first major tax reform in the US in 30 years, and this would likely receive a thumbs up from investors and send global stock markets upwards.

Economic Calendar

Tuesday (December 5)

Wednesday (December 6)

*All release times are GMT

*Key events are in bold


DAX, Tuesday, December 5 at 5:35 EDT

Open: 13,055.75 High: 13,095.50 Low: 12,994.00 Close: 13,000.00

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher [5]

Market Analyst at OANDA [6]
A highly experienced financial market analyst with a focus on fundamental analysis, Kenneth Fisher’s daily commentary covers a broad range of markets including forex, equities and commodities. His work has been published in several major online financial publications including Investing.com, Seeking Alpha and FXStreet. Based in Israel, Kenny has been a MarketPulse contributor since 2012.
Kenny Fisher

Latest posts by Kenny Fisher (see all [5])