frankfurt Tuesday can the dax Don’t use the good specs from Asia. The leading German index closes at 15,093 points, almost 0.1 percent less. have some support Munich Re, Hannover Re, RWE Y Eon with price increases of more than one percent each.

Latest Purchasing Managers’ Indices for January Germany reflect according to DWS an “expected weak phase” of the German economy. However, the evaluation of the companies is better than in the last seven months.

Stock analysts are not surprised by the lull in growth. “European investors have to digest the incredible momentum first,” says Mathieu Savary of renowned Canadian research firm BCA Research.

He refers to the strong growth registered by European stocks and the euro since October. Stocks measured by the Euro Stoxx 50 Index rose 26 percent, and the euro gained about 10 percent against the dollar over the same period.

In the long term, Savary remains optimistic about European investments. But in the short term he warns: “In the coming weeks you should expect a sideways movement at best and a correction at worst.”

Inverted Yield Curve Points to a Recession

Philip Bold, a fund manager at Ethenea Independent Investors in Luxembourg, is also cautious. The expert observes the so-called inverse yield curve in the USA.

In the world’s largest financial market, Wall Street, government securities that earn short-term interest earn higher interest than long-term ones. Six-month bonds currently yield 4.8 percent, while 10-year bonds yield less than 3.5 percent. Bold puts it this way: Players in the bond market see a recession as likely.

“Although the recession is on everyone’s lips, the stock market, which anticipates the development of the real economy, only seems to take into account a relatively mild slowdown”, says the expert. Although stock prices have suffered a lot in the past year, but: “An earnings downturn on the corporate side would have more consequences.”

Michael Winkler, Head of Investment Strategy at St. Galler Kantonalbank Germany, thinks similarly: “The markets are currently pricing with little or no risk and don’t want to spoil their good mood.” because the head of the ECB, Christine Lagarde, has just confirmed the decisive action of the central bank against the high price pressure and encouraged investors to reconsider an overly optimistic approach.

Early economic indicators gave only a partial nod. For the first time in six months, business sentiment in the euro area points to economic growth. The Purchasing Managers Index S&P Global was up 0.9 points to 50.2 points compared to the previous month, as market researchers announced on Tuesday.

With just over 50 points, the indicator returns to the range that indicates economic growth. In previous months, the indicator had also pointed to a contraction due to the war in Ukraine and inflation.

For Germany, on the other hand, the economic barometer indicated a contraction of 49.7 points. After all, the decline slowed for the third time in a row. The decisive factor was the services sector, which according to S&P posted slight growth for the first time since June.

Good vibes from abroad.

The tailwind of a better mood could drive European and German stocks away from the USA receive. Wellenreiter Invest’s Robert Rethfeld acknowledges that technology stocks on Wall Street have been rising faster than the broader market since early January. The expert also concludes from other observations that this development and a growing willingness to take risks among investors will continue.

Given these different valuations, the next economic data and quarterly figures from companies could provide a new boost for the markets. Figures from the Dutch chip maker will arrive on Wednesday. ASMLin the US since tesla, Boeing Y AT&T. To Germany The Ifo business climate index for January gives an idea of ​​the current situation of local companies and their business expectations.

The upcoming central bank meetings with expected interest rate decisions are also in the spotlight. The Federal Reserve meeting on February 1 is expected to see a 25 basis point hike in interest rates, investors say. Of the ECB instead, double steps and therefore half a percentage point are expected at their next meetings in February and March.

Individual values ​​in focus

Continental: The auto supplier recently triggered a price setback with bad reporting. On Tuesday, after an earlier loss, the stock even closed slightly in the black.

Infineon: The chipmaker can only benefit from good specs from US tech stocks and the chipmaker at the start of trading, losing 0.6 percent at the end of trading.

Rheinmetall: The armaments group expects between eleven and twelve billion euros in sales by 2025, chief executive Armin Papperger told “Stern” magazine. I had in november rheinmetall a sales target of ten to eleven billion euros by 2025. At the end of trading, the stock rose again, closing 0.6 percent higher.

Munich Re and Hannover Re: The two big reinsurers are preparing to deal with the uncertain general mood. After the market closes, they lead the dax with profits greater than one and a half percent.

More: Which stocks benefit from falling inflation

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