Morning Briefing: Deutsche, oil sell-off weighs on markets

Morning Briefing: Deutsche, oil sell-off weighs on markets

Morning Briefing: Deutsche, oil sell-off weighs on markets Deutsche, oil sell-off weighs on markets
A new low for US-listed Deutsche stocks and a sell-off of oil following recent gains are weighing on world markets so far Friday.

The massive penalty the German bank is facing from the DoJ has shaken financial institutions globally and banking stocks are suffering. A number of hedge funds said Thursday that they were reducing exposure to Deutsche but analysts says the bank’s stress tests do not raise liquidity concerns.

Asian markets closed mostly lower, led by a 1.46 per cent drop for Tokyo’s Nikkei; Shanghai was the outlier, closing with a narrow gain.

European markets have also been weakened by the banking sector with Deutsche stocks hitting a new record low for its German listing, following the record low for its US stocks. CPI data for the Eurozone is due and forecast to be slightly higher than the previous reading.

Wall Street and Toronto are expected to be subdued by global markets.
 
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North America (previous session)
US Dow Jones 18,143.45 (-1.07 per cent) -1.40 per cent +11.41 per cent
TSX Composite 14,754.55 (+0.16 per cent) +1.07 per cent +10.88 per cent
 
Europe (at 4.30am ET)
UK FTSE 6,845.14 (-0.99 per cent) -1.02 per cent +13.02 per cent
German DAX 10,281.65 (-1.19 per cent) -2.94 per cent +6.43 per cent
 
Asia (at close)
China CSI 300 3,253.28 (+0.27 per cent) -2.24 per cent +1.57 per cent
Japan Nikkei 16,449.84 (-1.46 per cent) -2.59 per cent -5.40 per cent
 
Other Data (at 2.30am ET)
Oil (Brent) Oil (WTI) Gold Can. Dollar
48.58
(-1.34 per cent)
47.27
(-1.17 per cent)
1329.60
(+0.27 per cent)
U$0.7598
 
Aus. Dollar
U$0.7613

 
 
Deutsche slump won’t trigger crisis say experts
Experts are watching the woes for Deutsche carefully but have dismissed comparisons to the disaster of Lehman Bros at the start of the financial crisis.

Despite the potential $14 billion fine from the DoJ, the bank will not collapse as liquidity reserves are strong.

The CEO of financial analysts Autonomous Stuart Graham says that the current fears of a major financial institution collapsing as a result of a regulator’s fine could be good news for Deutsche:

“Does the DOJ want to run the risk of being branded by European leaders as responsible for inadvertently bringing down the fourth most systemic bank in the world?" he wrote.