Market update: No confidence letter against May, Bitcoin sold for Bitcoin Cash

13 Nov

by Mihály Tatár

 

Good Morning!

 

  • With no further clarification on the US tax reform issues, most markets remained in waiting mode (SPX -0.09%, DAX -0.42%, Nikkei -1%. Shanghai +0.46%, EURUSD 1.1650, EURHUF 312, EURPLN 4.23), and traders entertained themselves by selling Bitcoin (down 20% in three days on the speculation that Bitcoin Cash will be more popular – but hey, it is a great way to store value) and Pounds (GBPUSD 1.31, after the media report that 40 conservative MPs are signing a letter of no confidence against May on Brexit, just before the critical meetings at the end of November). With the realization that Trump’s Asia trip was quite smooth, and with no fresh news on the Saudi purge, money was leaving Gold and safe bonds (Gold 1277 USD, US 10Y yield 2.40%, German 10Y yield 0.41% – global growth is at a 10-year-high, mind you), with oil traders wondering what to do up this high (WTI 56.80, Brent 63.50 USD).

 

  • The Arab Leage is set to hold an emergency meeting on Iran, and according to rumours, the Saudi air force has been mobilized to launch air strikes on Iranian proxies in Lebanon (that would be a first and would surely call for Teheran’s retaliation). The market doesn’t seem to see this as very likely, but we do know that Riyadh told its citizens to leave Lebanon immediately last week, and the Iranian – Sunni Arab plus Israel tensions are clearly skyrocketing. (Israel shot down a Syrian drone on the weekend and warned Iran that taking over Syria ’won’t be allowed to happen’).

 

  • Bloomberg notes that somewhat underreportedly in the media, the EU’s Recast Payment Services Directive (PSD2) will trigger a digital services disruption by fintech companies and will further pressure traditional banking. PSD2 will, for example, require banks to open customer accounts to third-party payment- initiation and data-aggregation companies which offer sophisticated solutions. (Essentially, banks will be forced to give access to alternative providers like Apple Pay and PayPal, for example.). This development probably also gradually reduces card-based transaction volume and the related bank revenue.

 

Have a nice week,

Mihály

 

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One Response to “Market update: No confidence letter against May, Bitcoin sold for Bitcoin Cash”

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