market report
Ahead of the US Federal Reserve’s eagerly awaited interest rate decision, investors in the German stock market are likely to keep their feet still. The DAX is unlikely to make any big jumps.
On the day of the Fed interest rate decision, the mood on the German stock market was rather subdued. The DAX is likely to start trading in the middle of the week not far from yesterday’s XETRA closing price. The broker IG currently values it at 17,990 points. The day before, the German standard values had achieved a small increase of 0.3 percent to 17,987 points.
This means that the stalemate on the German stock market over the past few days is likely to continue today. Since the beginning of the week, the DAX has been treading water below the record high of 18,039 points achieved the previous week. The leading German index has stuck to the psychologically important mark of 18,000 points.
Investors are looking excitedly towards the USA, where the two-day meeting of the Federal Reserve (Fed) ends this evening. According to the unanimous opinion of observers, the key interest rate is likely to remain in a range of 5.25 to 5.50 percent.
But investors are primarily hoping that the press conference with Fed Chairman Jerome Powell will provide information about when the first interest rate cut can be expected and how much the central bankers will increase interest rates over the course of the year. According to the CME Group’s Fed Watch Tool, the probability of an initial interest rate cut in June had recently increased slightly again to 55.2 percent.
One day before the Fed’s interest rate decision, investors on Wall Street were cautiously optimistic yesterday. The Dow Jones index of standard stocks closed yesterday 0.8 percent higher at 39,110 points. The technology-heavy Nasdaq advanced 0.4 percent to 16,166 positions. The broad S&P 500 gained 0.6 percent to 5,178 points.
Positive guidelines are also coming from the Chinese stock exchanges, as investors in China have gained new courage following the interest rate decision by the Chinese Central Bank (PBOC). As was generally expected, the monetary authorities left key interest rates unchanged. The Shanghai stock exchange is currently up 0.4 percent. In Japan, the stock exchanges will be closed today due to a public holiday.
In the run-up to the Fed’s decision, the dollar is weakening slightly, while at the same time the euro is rising by 0.1 percent to $1.0869. The price of gold is trending sideways, with 2,157 dollars being paid for a troy ounce of the yellow precious metal this morning.
On the German stock market, Douglas’ IPO worth almost 900 million is gradually coming into focus. The almost 32.7 million shares in the perfumery chain are being placed at 26 euros each and thus at the lower end of the aforementioned range. The first day of trading is scheduled for tomorrow. The Düsseldorf-based company primarily wants to use the money from going to the stock exchange to reduce its high level of debt.
The head of the arms company Rheinmetall, Armin Papperger, has sold shares for almost five million euros after the steep price rise in recent months. Specifically, according to a voting rights announcement, the manager sold shares for 4,906,492.60 euros this Tuesday. Since the start of Russia’s war of aggression against Ukraine, the number of securities has increased almost fivefold.
The medical technology company Eckert & Ziegler is planning to cut its dividend to finance future investments. The SDAX-listed company announced in the evening that the supervisory board and management board had decided to propose a reduced dividend of 0.05 euros per eligible share to the general meeting.
Microsoft is increasing its focus on artificial intelligence by hiring one of the most renowned experts in the field. Mustafa Suleyman is giving up his position as head of the AI start-up Inflection AI and taking over the management of a new Microsoft division. The AI products aimed at consumers are to be bundled under the umbrella of Microsoft AI.