market report
Status: 01.12.2022 07:29 a.m
Thanks to strong targets from the USA, the DAX should start with significant gains. Fed Chair Jerome Powell has announced that interest rate hikes will slow down soon.
Outstanding specifications for stock trading in Europe come from Wall Street, which should not fail to have an effect on the Frankfurt trading floor. The broker IG assesses the leading German index 1.4 percent higher at 14,594 points.
DAX targets June high
At the beginning of the new trading month, the DAX is about to surpass its most recent high of 14,572 points. Should he also succeed in this feat in regular trading, he would open the door wide towards the June high (14,709 points).
Powell’s speech moves markets
US Federal Reserve Chairman Jerome Powell breathed new life into sluggish markets yesterday when he promised interest rate hikes to slow down soon to combat high inflation.
“The time to moderate the pace of rate hikes could come as early as the December meeting,” Powell said in a speech at the Brookings Institution think tank. At the same time, he emphasized that monetary policy must remain strict for “some time” in order to restore price stability.
Dow and Nasdaq post strong gains
The probability of a 0.50 percentage point rate hike for the December 14 meeting is now 79.4 percent, according to CME Group’s Fed Watch Tool. Only 20.6 percent of market participants still expect an increase of 75 basis points.
The Powell speech gave the US stock markets a powerful boost midweek. The Dow Jones index of standard values closed 2.2 percent higher at 34,589 points. The tech-heavy Nasdaq advanced 4.4 percent to 11,468 points. The broad S&P 500 gained 3.1 percent to 4080 points.
Investors in Asia breathe a sigh of relief
Investors in Asia can also breathe a sigh of relief on hopes of smaller interest rate hikes in the USA. “It looks like Fed Chair Powell didn’t get the memo to buck turnaround hopes and keep financial conditions tight before he delivered his speech,” said ING’s Robert Carnell.
The Japanese Nikkei index just ended trading in Tokyo up 0.9 percent at 28,226 points. The Shanghai Stock Exchange was up 1.0 percent. The index of major companies in Shanghai and Shenzhen gained 1.7 percent.
Euro back above $1.04
In Asian FX trading, the dollar has weakened against all major currencies amid falling US interest rate expectations. At the same time, the euro rose by 0.3 percent to $1.0451.
Gold asked again
A troy ounce of gold cost $1,782 in early trading, up 0.5 percent from the previous day. The yellow precious metal is benefiting both from the weaker dollar – which fuels demand from non-dollar countries – and from the lower interest rate expectations, since it does not yield any interest itself.
Airbus pays millions over corruption allegations
Among the individual values in the DAX, the focus is on the Airbus share in the morning. The aircraft manufacturer has agreed with the criminal authorities in France to pay a sum of 15.8 million euros to avoid possible prosecution for suspected corruption in Libya and Kazakhstan.
Tesla plans to ramp up Model Y production
According to the US news website “Electrek”, Tesla plans to significantly increase production of its Model Y vehicle model in the new Gigafactory in Texas next year. The electric car manufacturer wants to roll 75,000 Model Ys there in the first quarter of 2023.
Musk declares dispute with Apple over
Twitter boss Elon Musk has rowed back after his verbal attacks on the US technology group Apple. Musk said on Twitter that he had a “good conversation” with Apple CEO Tim Cook. “The misunderstanding” about an alleged removal of the Twitter app from Apple’s app store was cleared up. “Tim made it clear that Apple never considered this.” Apple initially did not comment.
Salesforce co-CEO resigns
The US software manufacturer Salesforce surprisingly loses one of its top managers. Co-CEO Bret Taylor is leaving his post at the end of January, as the company announced yesterday after the US stock market closed. Company co-founder Marc Benioff will then become the sole CEO and head of the board of directors. The resignation was not well received on the market.