Market Commentary | Oil rallied while British Pound dipped

Markets in Europe ended the day with gains on Monday but still keeping an eye on Deutsche Bank’s shares as they resumed falling after the recovery on Friday

Markets in Europe ended the day with gains on Monday but still keeping an eye on Deutsche Bank’s shares as they resumed falling after the recovery on Friday, as hopes faded off a swift deal with US authorities over the multi-billion dollar penalty. The German market did not trade today as it was a public holiday but Deutsche Bank’s listed equity in the US lost around 2.5%.  

In the UK, markets also eyed the Brexit process following UK Prime Minister Theresa May’s statement on Sunday that the country will trigger Article 50 by the end of March 2017. This triggered a slide in the British pound towards a three-year euro low but also sending British Shares to a 16-month high. Tracking the Pound’s exchange rate slide, manufacturing output hits a two-year high. This will provide a further positive contribution to the Gross Domestic Product Growth. The FTSE 100 closed 1.23% higher.

Oil prices traded in the green too, after markets consoled by the OPEC’s decision to impose the production cap this November. This optimism stimulated markets to invest more in the crude oil, driving up prices and eventually Brent Crude traded above $50 per barrel.

Tech Side

Twitter Inc. shares were in the green, up around 2.6%, with rumors about a takeover bid from Google Inc. It emerged that Google Inc. hired Lazard Ltd. as an advisor to look at a possible acquisition, which would bring the search giant into the race with Microsoft, Salesforce, and even Walt Disney. Twitter could be Google’s most valuable acquisition if it plays out that way and it is the ideal way for Alphabet to deal with a Facebook threat. Twitter continues to underperform in financial results, although it was up 44.24% compared to six months ago but lost 12.39% of value in the past year.

Meanwhile, Facebook Inc. announced it would launch Marketplace, which will allow users to buy and sell items with other members of their community. The addition will be first to roll out in the US, UK, Australia, and New Zealand. This new entry will have to compete with household names such as e-Bay. Moreover, following the launch of Facebook lite last year, Facebook is expanding its reach in developing countries by introducing Messenger Lite. The application is designed for older and weaker devices and in slower network conditions.

Security Technology Company VirnetX shares skyrocketed over 30% after winning more than $302 million US Dollars in a lawsuit against Apple Inc. for infringing four patents. This also tracks the company’s last major patent win in December 2014 through a $23 million settlement with Microsoft.

Finally, Tesla Motors Inc., shares jumped over 4% after the company announced a record third quarter sales. The electric carmaker surpassed all estimates by reporting sales of 24,500 vehicles, which is double the amount sold in the same quarter last year. It also reported a boost in production and reiterated to hit 500,000 cars annually by 2018 due to strong demand.

This article was issued by Rodrick Duca, Trader at Calamatta Cuschieri. For more information visit, www.cc.com.mt . The information, views and opinions provided in this article are being provided solely for educational and informational purposes and should not be construed as investment advice, advice concerning particular investments or investment decisions, or tax or legal advice. Calamatta Cuschieri Investment Services Ltd has not verified and consequently neither warrants the accuracy nor the veracity of any information, views or opinions appearing on this website.