Good indications: tailwind for the DAX

Status: 03/06/2023 07:36 a.m

With good international conditions behind it, the DAX should start the new trading week on a positive note. Investors’ hopes are mainly directed towards China, and interest rate fears have receded somewhat recently.

At the start of the week, further growth is indicated on the German stock market. The DAX is calculated around 0.3 percent higher in the first indications and overcomes the mark of 15,600 points. The index follows on from gains from the weekly close, when it gained 1.6 percent to close at 15,578 points. He is also targeting his high for the year at 15,658 points.

Today’s agenda includes retail sales from the EU in the morning and January orders from the US in the afternoon. The euro is trading slightly higher at $1.06487.

Tailwind comes from good international guidelines. Both Wall Street on Friday and today’s Asian markets are supporting European listings.

Statements by US currency watchdog Raphael Bostic provided relief in New York. The president of the Atlanta branch of the US Federal Reserve (Fed) favors a slow and steady course for the Federal Reserve (Fed) with interest rate hikes of 25 basis points “as the effects of higher interest rates could only be felt in the spring”. A measured approach reduces the likelihood that the Fed will overshoot interest rates and hurt the economy.

Between interest rate fears and China hopes

The markets therefore remain fundamental between persistent interest rate fears and hopes that the Chinese economy will pick up again strongly after the end of the corona restrictions. Despite persistently high inflation and therefore increasing concerns about interest rates, the DAX had recently shown itself to be robust. However, inflationary pressures in the euro zone remain in the back of investors’ minds.

“Inflation and inflation again and again,” wrote Ulrich Kater, chief economist at Dekabank. He pointed out the danger of a wage-price spiral. Investors are eagerly awaiting the US labor market report on Friday, which is important for the monetary policy of the US Federal Reserve.

In Asia things are mostly uphill at the start of the week. In Tokyo, technology stocks in particular benefited from statements by leading bankers at the US Federal Reserve. They outperformed their US counterparts on Friday after Richmond Fed Chair Thomas Barkin said inflation “is likely to have peaked”. The Nikkei index closed 1.1 percent higher at 28,251 points and thus above the psychologically important mark of 28,000 points.

Further gains could be difficult for Japanese stocks as Fed Chair Jerome Powell is set to testify before Congress on Tuesday and Wednesday, followed by Bank of Japan (BoJ) Governor Haruhiko Kuroda’s final monetary policy meeting on the following two days . “Powell’s statement comes ahead of the payroll and inflation numbers, so he’s likely to avoid committing to a policy stance,” said Jan Nevruzi, analyst at NatWest Markets

Hong Kong, Australia and Korea also went up. There was some disappointment in the markets in China that the Beijing government revised its growth outlook downwards to a target of 5 percent instead of the 5.5 percent and above favored by the market. The Shanghai stock exchange was recently 0.2 percent in the red. The index of the most important companies in Shanghai and Shenzhen lost 0.1 percent.

Software AG intends to pay out significantly less dividends for the past fiscal year than experts had expected. The company announced on Friday evening in Darmstadt that an amount of five cents per share will be proposed to the general meeting. In 2021, 76 cents were still being paid. Analysts had previously expected 74 cents. Following the latest index changes by Deutsche Börse, the company’s shares will be relegated from the MDAX to the SDAX on March 20.

Major shareholder exits CS

Long-time Credit Suisse shareholder Harris Associates has left the crisis-ridden Swiss bank completely. Harris began reducing the stake in October and has now completely separated from it, Harris vice chairman David Herro told the Financial Times on Sunday. According to the newspaper, Harris owned up to 10 percent of CS shares last year. “It’s a question of the future of the business. There have been big outflows from wealth management,” Herro said.

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