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Research Market strategy
by Swissquote Analysts
Morning News

Deutsche Bank Invests in German Fintech Valued at More Than EUR1 Billion

Topic of the day

Deutsche Bank AG (DBK.XE) has acquired a 4.9% stake in online-banking startup Deposit Solutions GmbH, part of an investment that values the startup at more than 1 billion euros ($1.1 billion). The German lender said Thursday that it has been using the startup's technology for its deposit marketplace Zinsmarkt since 2017, adding that it hopes to profit from the startup's expected positive value development through its investment. Deposit Solutions is a portfolio company of listed fintech investor FinLab AG (A7A.XE), who said late Wednesday that the financing round with Deutsche Bank and others values the startup at more than EUR1 billion. After the investment, FinLab holds a stake of around 7% in the startup, it said. The companies didn't disclose the financial terms of the deal.

Swiss stocks

The SMI closed up 0.5 percent on 10,064 points Thursday. The decision of the Swiss National Bank (SNB) to leave the leading interest rate and the bank deposit rate unchanged at minus 0.75 percent caused some disappointment among investors during trading. Swiss foreign trade figures were also of interest. Switzerland posted a trade surplus of CHF 1.15 (previously 2.7) billion for August. The SNB confirmed its monetary policy, but revised its inflation forecast down sharply for the current year to 0.4 percent from 0.6 percent. A new method of calculating negative interest on bank deposits was also announced, which will benefit banks. Bank stocks led the Swiss market, with Credit Suisse up 1.7 percent, UBS up 1.4 percent and second-tier stock Julius Baer up 1.6 percent. Richemont gained 1.3 percent and Swatch 0.6 percent. Swiss watch exports rose significantly in August, especially to the US and China, while sales in Hong Kong declined because of the ongoing protests there.

International markets

Europe

European shares close higher as worries about oil supplies ease and the Federal Reserve's interest-rate cut boosts the market mood. The Stoxx Europe 600 gained 0.6% to 391.80 while the FTSE 100 rose 0.6%, the DAX was up 0.5% and the CAC-40 advanced 0.7%. "The fear surrounding the Saudi attack has disappeared, plus the Federal Reserve cut interest rates last night," said David Madden at CMC Markets. "The Fed has lowered rates twice in three months, which adds to the global move by central banks -- who have largely loosened monetary policy this year." Meanwhile, European banks rise after a weak take-up of the European Central Bank's latest round of TLTRO funding support, easing fears about potential problems facing the sector.Next shares are among the biggest FTSE 100 fallers after the fashion and home-ware retailer's first-half results left investors under-whelmed. Markets.com says Next increased total sales and remains highly cash-generative, but didn't raise its full-year profit guidance. "There's been no upgrade from the July update, so a touch of profit-taking is going on, one feels," says Markets.com's Neil Wilson. "Investors were perhaps looking for a bit more of a positive outlook."

United States

U.S. stocks ticked higher intraday as gains in shares of health-care, materials and technology companies put the S&P 500 within striking distance of its closing high. The broad stock market index rose 0.2% to 3013, putting it within 0.4% of July's record of 3025.86. The Dow Jones Industrial Average added 36 points, or 0.1%, and the technology-heavy Nasdaq Composite climbed 0.3%. As investors continued to assess the Federal Reserve's latest outlook on future interest-rate cuts, trade talks between representatives from the U.S. and China were scheduled to start in Washington ahead of high-level discussions in October. "The overall picture for the economy looks good," said Jeff Kravetz, regional investment director at U.S. Bank. "We have contained inflation, low unemployment and a resilient consumer. The economic outlook is still favorable with interest rates low, but we still have some caution with the geopolitical risks." Health-care and material stocks led the broader S&P 500 higher, with the sectors adding 0.8% and 0.6%, respectively. Tech stocks gained 0.4%.

Asia

Asian stocks mainly advanced following reassuring moves by central banks and as trade negotiations resumed between the U.S. and China.China's new benchmark lending rate fell for the second month in a row in September, as funding costs for commercial banks were lowered after the central bank unleashed billions of dollars liquidity into the banking system earlier this week.

Bonds

U.S. government bond prices held steady after the Federal Reserve added $75 billion to the financial system to stabilize short-term money markets in its third such operation this week. The yield on the benchmark 10-year Treasury note settled at 1.777%, unchanged from Wednesday. It was the first time this week that the yield didn't decline.

Analysis

IR lowers Credit Suisse to Sell (Buy)
IR lowers the Bauer target to 18,40 (22) EUR – Hold
DZ rises the Leoni target to 13 (9) EUR – Hold


Produced by MBI Martin Brückner Infosource GmbH & Co. KG on behalf of Swissquote. All news is acquired with journalistic accuracy. No liability is assumed for delays or errors.

 
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