market report
Status: 10/31/2022 3:18 p.m
At the end of a successful month on the stock market, investors are taking it easy today. This is not unusual after a strong interim rally and before an interest rate decision by the US Federal Reserve.
At the end of the month, investors are exercising restraint. The DAX has so far moved in a narrow range between 13,216 and 13,290 points. On a monthly basis, however, events were anything but calm.
Is the DAX still going up?
Because the leading German index advanced sharply by around 9.5 percent in October. Since its low at the end of September, the leading German index has gained over 1400 points. It’s not unusual for investors to take things a little easier – especially since there are no market-moving data on the agenda from the USA today.
However, technical analysts point out that the DAX has still not overcome its year-to-date downward trend and the resistance zone at 13,500 points. The ultimate litmus test for the price rally in the DAX is therefore still pending.
Wall Street sets the tone – Dow starts down
With its development in October, the leading German index primarily followed an even clearer recovery on the New York world’s leading stock exchange. At around 14 percent, the Dow Jones index rose more than it had in October in decades. Even predominantly weak results from the highly valued technology sector and an unstable economic situation were unable to dampen the good mood of US investors in October.
Today, however, it is around 0.3 percent down when it opens. After the time change in this country, the US stock exchanges open at 2:30 p.m. this week.
Above all is the Fed
The general optimism is currently being borne primarily by investors’ hopes that the Federal Reserve (Fed) will take a slower stance in its interest rate cycle in the future. The fact that the corporate earnings season hasn’t been all that bad so far, apart from a few major disappointments from the tech sector, has supported this trend.
There will be news from the Fed at the next interest rate meeting on Wednesday. Stockbrokers still expect the fourth interest rate increase in a row by 0.75 percentage points to a level of 3.25 to 4.00 percent. The big question, however, remains how aggressively the Fed will then proceed against inflation.
Euro inflation makes a leap upwards
In contrast, according to many market observers, the European Central Bank (ECB) is lagging behind in the monetary tightening cycle. The surprisingly sharp rise in the reported this morning inflation rate in the euro area in October to 10.7 percent further increases the pressure on the monetary watchdog around Christine Lagarde. Nevertheless, there are of course also discussions in Europe about how the interest rate cycle of the ECB could continue.
“Today’s data increases the probability that the ECB will raise its key interest rates again by 75 basis points in December, especially since the euro economy still grew by 0.2 percent in the third quarter compared to the second quarter,” explains Commerzbank economist Christoph Weil .
The FX market was initially unimpressed by the data release. In the meantime, however, the euro is crumbling more and is trading at $ 0.9893 in the afternoon – a drop of a good 0.5 percent.
Weak China data weighs on oil prices
Oil prices have now recovered and tend to change little. After weak economic data from China, they initially fell. A barrel (159 liters) of North Sea Brent currently costs 95.25 US dollars, which is the same as on Friday.
FMC and Fresenius at the top of the DAX
In the DAX, the shares of Fresenius and FMC are proving to be a price support for the leading German index, contrary to what was feared, although the medical group and its dialysis subsidiary had lowered their forecasts again yesterday due to the currently difficult economic environment.
After the group’s second profit warning within a few months, the new Fresenius boss Michael Sen announced that all activities would be put to the test. “We evaluate all transactions, from top to bottom and at high speed,” said Sen today in Bad Homburg. “That will result in more severity.” Meanwhile, costs would need to come down to cope with a tough environment.
These are tones that are well received on the stock exchange. Some investors could sense an opportunity to get started, traders said. FMC and Fresenius shares are enthroned in the afternoon with price gains of more than six and five percent respectively at the top of the DAX.
DWS boss sees no errors in information about green funds
The fund company DWS has denied misconduct with regard to climate protection. “It may be true that the issue has been very vocally promoted in the past. But we are now almost done with our internal investigations and we continue to stand by our financial reports and prospectuses,” said Deutsche Bank CEO, who has been in office since June. daughter, Stefan Hoops, of the “Frankfurter Allgemeine Sonntagszeitung”.
Swiss boss sees Lufthansa subsidiary on the right course
Swiss boss Dieter Vranckx is convinced: “Swiss has turned the corner.” The first nine months of the year were profitable, he said in an interview with “SonntagsBlick”. By the end of the year, the Lufthansa subsidiary wants to have hired 800 new cabin workers, and in 2023 around 80 pilots are to be followed by 1,000 new flight attendants. “We want to achieve stability for 2023,” said Vranckx.
Corona lockdown: Workers from Apple supplier Foxconn flee
In China, employees of the Apple supplier Foxconn fled after a corona lockdown. Numerous videos of workers leaving the company’s factory premises in the eastern Chinese metropolis of Zhengzhou circulated on social media over the weekend. You could see how people sometimes climbed over fences and escaped across fields with suitcases and belongings.
Verified accounts on Twitter should cost money
According to media reports, tech billionaire Elon Musk wants after the expensive Twitter takeover earn money by verifying users. Last night, the technology blogs “Platformer” and “The Verge” reported that the verification ticks, which guarantee the authenticity of the Twitter profile, should in future only be available for customers of the Twitter Blue subscription offer. It currently costs $4.99 a month.
Credit Suisse starts capital increase
Credit Suisse is beginning to implement the capital increase announced last week. The Saudi National Bank and other professional investors will receive 462 million new shares at a price of CHF 3.82. The issue price for the 889.4 million shares to be placed with existing shareholders as part of the subscription rights offering is CHF 2.52. They should be able to acquire two new titles for every seven shares held. Overall, the bank expects gross proceeds of four billion Swiss francs from the transaction.