market report
After the latest inflation shock from the USA, investors’ eyes are now turning to the ECB meeting. After the renewed setback in the DAX, nothing more than stabilization seems possible.
The German stock market is showing remarkable resilience in the face of negative guidance from Wall Street. The DAX is likely to start trading very close to yesterday’s closing price. The broker IG estimates the German standard values at 18,102 points at the moment. The day before, the DAX had closed at 18,097 points, 0.1 percent up – and at first glance provided a reconciliatory end to a turbulent trading day.
At its lowest point it temporarily fell to 17,976 points and thus below the old all-time high of 18,039 points. Although the leading German index was subsequently able to regain this mark, the DAX is now clearly in technical difficulty. The bulls’ main goal remains to prevent a sustained slide below 18,039.
Otherwise, the downward momentum on the German stock market would suddenly increase. Below 18,039 points, the DAX would have significant room for downward movement; the next holding zones would only be visible at around 17,700 points.
Negative guidelines for DAX trading come from Wall Street. Surprisingly high inflation had spoiled the mood of investors there. The Dow Jones Industrial sank to its lowest level in eight weeks and closed 1.1 percent lower at 38,461 points.
The technology-heavy Nasdaq fell 0.8 percent to 16,170 points. The broad S&P 500 lost 0.9 percent to 5,160 positions – while yields on the bond markets continued to rise.
In March, price increases in the USA unexpectedly accelerated significantly. Consumer prices rose by 3.5 percent compared to the same month last year. The core inflation rate remained at its high level of 3.8 percent.
This significantly dampened interest rate cut expectations: on the futures markets, the probability of the US Federal Reserve turning interest rates at its meetings in June and July is now only estimated at just under 20 percent and 45 percent. For comparison: Before the data was published, it was 55 and 70 percent.
Today, other economic data from the USA that is receiving much attention on the market is on the agenda: producer prices and weekly unemployment figures. Before that, investors in this country are turning their attention to the meeting of the European Central Bank (ECB). The market is firmly assuming that the monetary authorities around ECB boss Christine Lagarde will keep their feet still today.
However, investors are hoping for indications of a possible interest rate cut in June, which is being speculated on in the market. However, experts point out that in the past the ECB has almost never moved ahead of the Fed when it came to cutting interest rates.
The Asian stock markets were unable to agree on a common direction today. While the Shanghai stock exchange is currently up 0.6 percent, the Japanese stock market is trending weaker. In Tokyo, the 225-value Nikkei index was down 0.4 percent at 39,405 points in late trading.
In Asian foreign exchange trading, the euro can only make up a little ground after its price slide yesterday. The European common currency gains 0.1 percent to 1.0746 dollars.
The day before, the euro had fallen below the $1.08 mark after the publication of the surprisingly high US inflation figures, as the lower expectations of interest rate cuts in the USA strengthened the dollar. A troy ounce of gold costs just under $2,343 per troy ounce this morning.
Things have been pretty quiet on the company side so far this morning. According to a media report, the works council head of the Walldorf-based software manufacturer SAP, Eberhard Schick, welcomes severance payments in the planned job cuts. “Many older employees are really happy when they can retire with a golden handshake,” Schick told Capital magazine.
ProSiebenSat.1 is starting the sale of investments, which was also requested by the major Italian shareholder MFE. “We have improved the profitability of our e-commerce companies and initiated a sales process with banks for two of our largest assets Verivox and Flaconi in order to generate maximum value,” said CEO Bert Habets yesterday.
Amazon has been ordered to pay more than half a billion dollars in a patent lawsuit involving data storage technologies. Jurors in Chicago concluded yesterday that the company violated three patents of the US company Kove in the service of its cloud division AWS. They awarded Kove $525 million. Amazon wants to appeal, said a spokesman.