US stocks lower following 3%+ falls in Europe, ASX futures down 66 points

It seems I spoke too soon yesterday regarding Europe's muted reaction to the Volkswagen (VOW3) issue and the Greek election - last night was a doozy. Today's first chart shows the fall in the VOW3 share price (the preference shares listed the on Rivkin Trader platform, shown in black), which has fallen from a close of 167.80 euro last Thursday to 107.05 last night - that's a 36% fall that equate to about 27 billion euro being stripped off its share price over the pollution cheating allegations that emerged a couple of days ago. Germany's DAX--orange, first chart--has been dragged down in chorus with VW shares and closed a whopping 3.80% lower last night and this gave the US market a really poor lead. There will be a lot of disappointment directed at Europe's largest car maker given its status as a metaphor for Germany's resilient export industry. The penalties are likely to be in the many billions - so let's see if this response is justified!

In today's second chart I've shown the ASX 200 alongside the ASX 200 SPI futures market continuing to track sideways since the August volatility. We remain nowhere near the range's daily closing high of 5,263 for the ASX 200 and until this level is broken, I would suggest that short-term traders focus on short positions or sit the market out until it finds some medium-term direction. It's a hard one to pick, but I'll reiterate that I am delighted that Rivkin Global's model portfolio--our product for active traders--continues to trade profitably in this market.

Where the third chart would normally sit, I have illustrated Rivkin Global's open portfolio for illustration purposes only. (These trades have already been opened and most are sitting in profit, so I DO NOT suggest anyone treat these open trades as recommendations.) You can see that there is a mix of 'long' (benefits from upward price movements) and 'short' (benefits from downward price movements) positions across multiple assets including precious metals, US equities, Australian equities, crude oil and index futures. Please click here to learn more or email if you'd like to join current Rivkin Global members who trade this way.

Source: Rivkin, Saxo Bank

To view the Rivkin economic calendar and Global Markets matrix, members can click here.

This article was written by Scott Schuberg, CEO of Rivkin Securities Pty Ltd. Enquiries can be made via or by phoning +612 8302 3600.

Complex product warning

This article contains information about foreign exchange contracts, which are considered complex financial products. Please click here to read ASIC's foreign exchange trading article before considering an investment in foreign exchange contracts. 

This article contains information about CFDs, which are considered complex financial products. Please click here to read ASIC's "Thinking of trading contracts for difference?" document before considering an investment in CFDs.
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