Dax closes over 250 points higher

Dusseldorf After a turbulent start to the week, things continued to improve significantly on Tuesday. The Dax ended the trading day at 15,195 points – an increase of 1.8 percent or the equivalent of 262 points.

For Jörg Scherer, technical analyst at HSBC Germany, yesterday’s trading was a classic reversal formation, called “reversal” in technical jargon. This is the reversal of a price trend. The quick recapture of the groundbreaking mark of 14,800 points also plays an important role.

There are also other technical indicators that allow Scherer to come to the conclusion: “In the past, this phenomenon often caused at least a temporary countermovement.” The US stock market indices such as the Nasdaq 100 technology index are now also showing a constructive development.

Further rising prices are also the basic scenario of the Handelsblatt survey Dax-Sentiment. Sentiment expert Stephan Heibel says after evaluating the weekend survey: “With the mood currently very negative, another sell-off, a crash, would be rather unlikely without further negative events.” He sticks to his assessment of the past few weeks that a Surprise can only be done on the top.

US retail investors are extremely pessimistic

The mood values ​​​​of US investors show a similar picture. The most recent sentiment survey by the American Association of Individual Investors (AAII) only shows a bull share of 19.2 percent.

Dax investors are becoming bolder again

Scherer from HSBC Germany knows from experience: “Values ​​below 20 percent indicate extreme skepticism and often mark lower turning points” for the stock market. The logic behind this reasoning is that the worse sentiment is, the more investors have already sold their shares and the fewer potential sellers remain.

With the daily low of 14,458 points, the consolidation has expanded to eight percent since the annual high of 15,706 points two weeks ago. For classification: So far, this is only a decent, but quite typical setback on the stock market.

The only surprise was the speed with which the German stock market barometer slipped. Conversely, this also means that things can quickly go up again.

So far, this has not been a correction, which starts at minus ten percent and often lasts longer. And the low of this price slide was 14,458 points, still 600 points above the important 200-day line, which is currently at 13,841 points.

Oil price rises again

The price of oil is one of the biggest losers in the recent banking crisis. However, the price of Brent from the North Sea stabilized again this Tuesday and rose by 0.9 percent to $74.46 per barrel.

For Andurand Capital hedge fund manager Pierre Andurand, the recent drop in oil prices due to banking crises is speculative. He expects the price to rise to $140 a barrel by the end of the year. Demand will peak around 2030, he said, adding: “Even if we do peak, oil demand won’t go down anytime soon. We will peak demand around 110 million barrels per day and slowly decline from there.”

“If the banking crisis does not spread further, market sentiment could stabilize and oil prices could recover,” said Haitong Futures analysts. The oil price has fallen by more than 40 percent since last June. It is therefore eagerly awaited when the alliance of oil exporting countries, Opec plus, meets on April 3rd.

Important US interest rate decision pending

Investors are likely to regroup after the US interest rate decision that the Fed will announce on Wednesday after the stock market close in Germany. After the recent banking turmoil, this time interest rate meeting is as exciting as it has been for a long time.

In doing so, the Fed must decide whether its precautionary measures, such as increased foreign currency liquidity, are intended to give it the freedom to take more action in the fight against inflation. That would mean further rate hikes as planned.

Or are the precautionary measures more a sign that preventing crises takes precedence over fighting inflation? Then the planned interest rate cycle would be more moderate.

The majority expects a small rate hike of 25 basis points. According to Commerzbank, the market is no longer fully pricing in an interest rate hike of 25 basis points, but only sees a small chance for it. If investors have their way, this could already be the last rate step in the current cycle of increases.

Should the Fed completely forego an increase, according to Thomas Altmann from the investment house QC Partners, the stock market traders could see this as a warning signal in view of a much deeper banking crisis. “Therefore, I suspect that the Fed will go ahead with another hike to ‘business as usual’,” is his assessment.

Look at individual values

bank stocks: After the crash last week, the titles were able to recover significantly. The index was led by the shares of Commerzbank and Unicredit – the Commerzbank shares rose by 7.4 percent and Unicredit by seven percent. Deutsche Bank shares also rose by around six percent.

Hella: The automotive supplier wants to pay a dividend of 2.88 euros per share for its short fiscal year. This is made up of the regular dividend of EUR 0.27 per share certificate, as announced on Tuesday by the group, which operates under the Forvia umbrella brand after the takeover by Faurecia. In addition, a special dividend of EUR 2.61 per share is to be paid out after the exit from the HBPO joint venture. The stock rose 1.2 percent.

RWE: After growth in the new financial year, the energy group wants to build on the result of 2022 in operational terms. Shareholders, including the sovereign wealth fund from Qatar, are to receive a stable dividend of 90 cents per share and a distribution of one euro per share certificate for the current year. The news sent the stock up 1.4 percent.

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