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XTB TRADEBEAT

Wall Street gains, soybean surges as trade tensions wear off

Summary:

  • US stocks make decent gains on Monday as trade tensions have been set aside at least for a while
  • Subsequent differing comments with regard to a truce between the US and China
  • Soybean prices shoot up in the aftermath of the China-US trade announcement alike

Asian trading has been passing quite calm, and as a result major indices have barely moved thus far. Among the major losers we have got the Australian stock market (AUS200 on xStation5) being set to close almost 0.8% lower as well as the Chinese Shanghai Composite is sliding 0.5% jut a while before the close. Looking elsewhere, one may notice calmness as the Japanese NIKKEI (JAP225) is set to end the day with a 0.1% loss whereas the Chinese offshore index Hang Seng (CHNComp) is going nowhere. Looking back to what happened on Wall Street yesterday one needs to single out the Dow Jones as it jumped as much as 1.2%. The oldest US index was buoyed by a near 2% increase in General Electric shares (GE.US) as the company agreed to a $11.1 billion merger of its transportation unit with Wabtec, a manufacturer of rail equipment. Along with GE one cannot leave out Boeing (BA.US) being shored up by a truce between the US and China which is particularly important for the enterprise as it exports a chunk of its goods to China. Other US indices also rose but gains were not so impressive. The SP500 (US500) added 0.75% while the NASDAQ (US100) moved up 0.5%. Last but not least, the Russell 2000, the US index consisting of small cap companies, which managed to hit its record peak for a fourth straight session and closed 0.7% higher.

link do file download linkIt looks that the US30 might be already geared up for an extended increase similarly to its peers in the US. Technically speaking buyers could drive the price even toward 25800 points while the crucial support might be localized nearby 24500 points. Source: xStation5

Over the past hours we got several quite differing comments with regard to a truce announced on Sunday between the US and China regarding trade. While some pundits claim that a truce could not last too long as it does not resolve fundamental differences on trade and other economic issues, others reckon that it could be a small step toward right direction and toward solving trade frictions once and for all. President Donald Trump praised Chinese attitude tweeting on Monday "China has agreed to buy massive amounts of ADDITIONAL Farm/Agricultural Products - would be one of the best things to happen to our farmers in many years!" and that "On China, Barriers and Tariffs to come down for first time". Among commodities soybean was the one which benefited substantially from the trade deal, and the move could be yet more accelerated due to Reuters revelations we were offered overnight that the US-China deal is going to include a pledge to remove tariffs on US agricultural products, and to import more of those goods.

link do file download linkSoybean jumped appreciably on Monday as trade frictions between the US and China eased off. The price bounced off its support and got back to the bullish channel. Notice that soybean buyers using a buy and hold strategy could take advantage of backwardation as opposed to wheat and corn. Source: xStation5

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