market report
The interest rate euphoria is keeping the record rally on the stock markets going. At the end of the week, the DAX remains within striking distance of its record high achieved yesterday. Is there anything else going on?
Yesterday’s interest rate cut by the Swiss National Bank (SNB) further fueled risk appetite on the stock markets. Investors hope that other central banks will quickly follow suit. The interest rate euphoria continues at the end of the week – and could initially prevent major profit-taking in the DAX.
The broker IG currently values the DAX 0.1 percent lower at 18,164 points. The German leading index remains close to its record high of 18,179.81, which was achieved yesterday.
The upward trend in the DAX is still intact, which gives investors hope that prices will continue to rise. “If you interpret the price development of the past year as a sliding zone, then the price target is even at 18,400 points,” emphasizes Jörg Scherer, Head of Technical Analysis at HSBC.
However, the market situation, which is heavily overbought after the long run-up of prices, calls for caution. If larger profit-taking occurs in the DAX at a certain point, the fall height is now quite high: only at the level of the previous week’s low of 17,663 points can a first important holding zone be identified for the DAX.
The US stock exchanges have strong guidelines for DAX trading. A new rally in technology stocks and continued interest rate hopes helped the major US indices set new records. The three most important indices closed higher than ever before for the second day in a row: The Dow Jones index of standard stocks rose by 0.7 percent to 39,781 points, the broader S&P 500 rose 0.3 percent to 5,242 points. The Nasdaq technology exchange gained 0.2 percent to 16,402 points.
A positive surprise in Micron’s quarterly report sent the entire sector soaring. The memory chip manufacturer’s shares closed with a gain of 14.2 percent.
However, there are mixed reports from the Asian stock markets this morning. Prices are weakening in China and Hong Kong, and the Shanghai stock exchange is currently down 1.0 percent. The Japanese leading index, on the other hand, made small gains and ended the weekend with an increase of 0.2 percent to 40,888 points.
The dollar is showing strength in Asian foreign exchange trading. At the same time, the euro fell by 0.2 percent to $1.0841. The stronger dollar is also depressing demand for gold. The price for the yellow precious metal fell by 0.4 percent to $2,174 per troy ounce.
Adidas shares are the focus of the DAX this morning. The sporting goods manufacturer was apparently surprised by the end of the more than 70-year partnership with the German Football Association from 2027. From 2027, the national soccer team will wear jerseys from Nike instead of Adidas.
China’s trade minister met yesterday with Mercedes-Benz CEO Ola Källenius. As the Chinese Ministry of Commerce announced today, they want to jointly defend themselves against protectionism and push for the European Union (EU) to keep the market for Chinese car products open.
According to DHL, demand for parcels increases significantly during Easter. Germany’s largest parcel service provider DHL said around nine million parcels were expected on the Tuesday after Easter. That would be 0.6 million more than a year earlier.
The US sporting goods manufacturer Nike is preparing its shareholders for a dismal sales development for the time being. According to CFO Matthew Friend, revenues are likely to fall in the low single-digit percentage range in the first half of the coming 2024/25 financial year. After initial gains, the stock quickly turned negative after trading.
The logistics group FedEx is making progress with its restructuring. The company increased its operating profit by 19 percent to $1.24 billion in the third quarter, more significantly than analysts expected. The share price shot up 14 percent in after-hours US trading.