Airbus, Rolls Royce and Siemens to develop a hybrid plane

Today’s Topics:

• Dax Overview
• Airbus, Rolls Royce and Siemens to develop a hybrid plane
• SAP and Microsoft join forces
• U.S. markets overview

With a new week around the corner the German DAX still seems unsure about which direction it wants to take. After opening at the 13011 point mark the stock Index increased rampantly to the 13052 day-high and dropped well its below opening price to the 12970 point mark. Succeeding the volatile morning the DAX has been rising ,supported by the EURUSD, for the rest of the trading day hitting the 13066 point mark, effectively increasing by 50 bp. After massive losses of 12% the German TV Mammoth ProsiebenSat1. was able to gain 2,63% throughout the trading day and thus being the biggest winner today. Meanwhile Linde, the industrial gases group which said late on Friday it had received approval from 90 percent of its shareholders for its planned $80 billion tie-up with Praxair is up 2,04%.

Airbus, Rolls-Royce and Siemens have come together to develop a hybrid electric engine as the race intensifies to advance battery technology and electric motors to lower flying costs and move away from fossil fuels. Dubbed the E-Fan X programme, the three companies anticipate flying a demonstrator aircraft in 2020 after ground tests, provisionally on a BAe 146 aircraft. “We see hydro-electric propulsion as a compelling technology for the future of aviation,” Airbus Chief Technology Officer Paul Eremenko said in a joint statement. Airbus will be responsible for the control architecture of the hybrid-electric propulsion system and batteries, and its integration with flight controls. Rolls-Royce will be responsible for the turbo shaft engine and 2 megawatt generator, while Siemens will deliver the 2 MW electric motor.

Business software giants Microsoft Corp and SAP SE have agreed to expand the use of each other’s cloud-based products and services delivered via the internet, they said on Tuesday, as they laid out a common product road map for joint customers. In a joint statement, Microsoft said it would use SAP’s S/4 HANA database to help run its core internal financial planning functions – replacing older SAP software, while SAP said it would run more than a dozen of its critical internal financial systems on Microsoft’s Azure cloud service. The long-time partners said the latest integration of their products was designed to encourage more of their joint customers to run SAP software on Microsoft Azure cloud services. Mutual customers include Coca-Cola Co, Columbia Sportswear Co and Costco Wholesale Corp. SAP encourages its customers to run its products not only on Microsoft Azure but also on rival cloud platforms from Amazon, Google, IBM and SAP’s own in-house cloud services. The two companies agreed 18 months ago to work together to integrate Microsoft Office 365, the cloud-based version of Microsoft’s flagship productivity software, into SAP, while SAP agreed to run its HANA database software on Microsoft Azure.

Wall Street got off on the right foot yesterday morning after the Thanksgiving Day weekend, with the Dow Jones Industrial Average, the Standard and Poor’s 500 Index, and the NASDAQ all racing to new all-time highs in the first hour of trading. On point, the Dow jumped by some 80 points at its morning peak, while the NASDAQ was about 10 points to the good. Optimism about holiday sales in the wake of some positive early shopping indications and as a sense that at least some tax reform measure will pass by yearend dominated the early thinking. However, this initial burst of optimism was short-lived, and as we reached the noon hour in New York, the Dow had given back just about all of its early rise (it had actually turned negative briefly), while the S&P 500 Index and in particular the NASDAQ had gone into the red, as profit taking took hold. Then, after this late-morning selling burst, the market steadied somewhat, with the Dow turning positive once more. However, the comeback was not fully inclusive, as the S&P 500 and the NASDAQ remained in the minus column as we moved into the afternoon. The mid-session pullback evolved as the early rally in the retail stocks fizzled. The gains had took hold after signs pointed to a solid showing on Black Friday. The early upturn also reflected some optimism ahead of Cyber Monday’s results. Several chains, in fact, led by Dillard’s Inc., turned nicely higher. On the other hand, stocks of other retailers faltered on the day. Meantime, as noted, investors also were watching for developments surrounding the Republicans tax plan, with the Senate vote scheduled for this week. Also in the news was Dallas Federal Reserve President Robert Kaplan, who said on Sunday that he would support a December interest rate increase. Earlier, he had been on the fence regarding such a policy action. He also warned of possible financial imbalances going forward, noting that the stock market has gone for 12 straight months without even a 3% correction. Overall, stocks wilted as the afternoon proceeded, with the aggregate mood being influenced by this news ahead of further Washington dealings. Things would change little as the afternoon wound down, so that as we entered the homestretch, the indexes remained range bound, as before, with the Dow clinging onto a small gain, while the other indexes fell back modestly. All told, as the final bell sounded, the Dow was able to hold on to a 23-point advance, while losses of one and 11 points, respectively, were tallied by the S&P 500 Index and the NASDAQ. The small-cap Russell 2000 also softened, while nearly all of the ten leading equity groups closed lower. Elsewhere, we see that oil prices, which moved lower yesterday and took some oil issues with them, have now started trading with additional early losses. Also, interest rates now are up a bit, while U.S. equity futures are showing some early gains. In sum, the day is likely to be influenced by the latest news on taxes, the economy, and the Fed.

Today’s Economic Calendar:

• International Trade in Goods
• Consumer Confidence
• Richmond Fed manufacturing Index
• State Street Investor Confidence Index

ProSiebenSat1 stock down 13%

Today the DAX fell to the 11900 point mark and is accounting for a loss of 1,60% one hour before close, standing at the 11930 point mark. At this time no stock is in the green range with the biggest loss coming from the German Media Behemoth ProsiebenSat1 with a booming 13% loss. Investors seem to be looking to invest in assets deemed safe such as Gold, which is up 0,6%.

ProsiebenSat1 warned that TV advertising revenues in German-language markets would decline in the third quarter and said it may look for external investors. The top German free-to-air broadcaster had already cut its TV advertising market outlook twice this year but said as recently as earlier this month it still expected a bounce-back in the second half of the year. Many major companies that rely on ad revenue have reported spending cuts by makers of fast-moving consumer goods such as Unilever, Nestle and Procter & Gamble – the world’s biggest advertisers – as they respond to weak global economic growth. Goldman Sachs downgraded ProSieben to “neutral” from “buy”. “We believe shares will remain under pressure until the first signs of market improvement (this is likely to affect other ad-exposed stocks as well),” it wrote. ProSieben shares were down 11.6 percent to 28.90 euros by 0820 GMT, at the bottom of the German blue-chip DAX and dragging the European media index down 2.5 percent.

Following a brief early tease to the upside, which saw the Dow Jones Industrial Average rise close to 50 points in minutes after yesterday’s market open, further reflections on the widespread damage caused by the hurricane that ravaged Houston and other parts of the southeastern portion of Texas over the weekend, the equity market quickly turned lower. As has been the case for much of this year, however, the pullback was relatively mild, with the Dow continuing to trade between 20 and 40 points lower, while the S&P 500 held just below the breakeven line. Breaking things down, the most of the morning saw more stocks decline than rise on the NYSE, although the differential was modest. One outlier was the NASDAQ, which gained nicely during this time. As for individual stocks, the Dow was pushed lower by a multi-point early decline in shares of Travelers. Energy prices also faltered on the damage brought on by the hurricane, with driller Schlumberger pulling back, and nearing a 52-week low in the process. As to other trading influences, with a heavy week of economic news before us, headlined by this Friday’s reports on employment and unemployment, along with key data on manufacturing, Wall Street was also consumed with the latest political news, where, this week, President Trump is expected to push his tax reform package, the timing of which could be in some jeopardy if costs to pay for the hurricane balloon in the months to come. Also, with pivotal data due on the economy, some focus will logically turn to the Federal Reserve, as it prepares to meet this month. Meanwhile, after this mid-morning Dow reversal, stocks steadied somewhat, so that as we neared the noon hour in New York, the blue-chip composite was nearing breakeven, while the NASDAQ’s gain was increasing. Then, as the afternoon got under way, stocks slipped anew, and within an hour, or so, the Dow and the S&P 500 were well into the red, while the NASDAQ’s gain, once 27 points, had eased to nine. Joining Schlumberger in the red, meantime, was food giant General Mills , with its setback bringing that quality issue to within a point of a new low. Stocks then stayed range-bound into the late afternoon, before some last minute buying almost wiped out the Dow’s deficit. Even so, at the conclusion of the session, that composite was off by only five points. A token gain, meantime, was tallied by the S&P 500 Index and a 17-point advance was inked by the NASDAQ. In the end, much of the day’s focus was on Hurricane Harvey, which was crippling the energy industry in Texas. As for the ultimate cost of the tragedy, above and beyond the human toll, it will be steep, with a partial offset from rebuilding. The potential of such rebuilding, in fact, did help one Dow stock to a hefty gain on the day, as The Home Depot jumped nearly $2.00 a share. Elsewhere, there was little excitement on this Monday in late August. Looking ahead to a new day now, we see that stocks were tumbling across Asia overnight, on jitters about North Korea that emerged late yesterday, while in Europe, the major bourses are now trading much lower, as well, on those same fears. In other markets, oil is little changed; gold, up sharply in recent weeks, is soaring again after North Korea launched another missile; and Treasury yields are down notably in a flight to safety. Finally, our futures are moving decidedly lower at this early hour, with the Dow suggesting an opening loss in excess of 100 points.