Morning Call. Market Overview for 16.09.2016

The Big Picture:

Bayer is looking to takeover the US seed producer Monsanto at 128 USD per share. Monsanto stock dropped 2.48% yesterday. It is becoming apparent, that investors do not believe in anti trust authorities permitting the takeover. The acquisition of Monsanto is the biggest German takeover ever to be held. Bayer is motivated by the ever increasing world population and the ensuing higher demand for foodstuffs. Additionally, Bayer is looking to profit from the global trend to higher quality foods. Bayer is strong in Europe and Asia, whilst Monsanto´s foothold is in North and South America. Bayer´s herbicides and Monsanto´s seed will clearly complement each other. US farmers fear price increase and these have a very strong political lobby in the USA.

DAX

The DAX is in a downwards trend.

EUR / USD

The Euro is trading sideways in a large trend. Support is at 1,0822, resistance at 1,1429. Short term the Euro is in a upward trend.

USD / JPY

The USD is in a downward trend against the Yen. Major support is at 100 on a closing basis.

Gold

Gold mid term, is trending sideways.The next major resistance is at 1375, support at 1300.

WTI Oil

Oil is in a downward trend.

Overnight:

The DAX enden trading in positive territory at +0.51%. Whilst Siemens rose 3%, Bayer, who's Monsanto taker is viewed negatively by investors, dropped 2.3%. Siemen´s CEO Jo Kaeser gave a positive prognosis for the year. The Bank of England signaled that it is looking lower interest rates in the course of this year, market participant expect this to take place in November. Markets were influenced by US economic data. US Retail Sales came in weaker than expected, leading to hope that the Fed will not raise interest rates, which in turn caused the S&P500 to rise by 1%. Most Asian markets followed US markets in to positive territory. USD and Gold are unchanged, whilst Oil loses 0.68%.

Today´s numbers (CET):

• 14:30 USA: Consumer Prices
• 16:00 USA: University of Michigan ( sentiment indicator)

Corporate news:

• USA: Quarterly Earnings: No relevant data expected