The 14,000 point level has become a key resistance.
(Photo: Bloomberg Creative/Getty Images [M])
Frankfurt The Dax started the day at a discount. In early trading, the leading German index fell 0.7 percent and fell to 14,470 points. On Monday it had increased by 0.8 percent to 14,576 points. In doing so, it defied the German inflation rate, which rose by 7.9 percent over the year in May.
Nevertheless, according to Martin Güth, investment analyst at Landesbank Baden-Württemberg (LBBW): “Inflation is not letting go of the markets.”
The inflation data for the euro area will finally be published this Tuesday at eleven o’clock. The official forecast for inflation in May year-on-year is 7.7 percent.
However, the whispered estimates are likely to be even higher, because on Monday not only the German, but also the Spanish and Belgian inflation data rose significantly more than expected at 8.7 and 9 percent.
Top jobs of the day
Find the best jobs now and
be notified by email.
In addition, wage growth in the euro zone in the first quarter almost doubled compared to the previous year at plus 2.8 percent compared to the previous quarter. That’s why Ulrich Stephan, chief investment strategist for private and corporate customers at Deutsche Bank, says: “The risk of a wage-price spiral can no longer be dismissed out of hand.”
Embargo makes the price of oil rise
In addition, the rising oil price is unsettling – as a result of the more extensive embargo on oil imports from Russia, which the EU member states agreed on Tuesday night.
>> Read here: EU countries agree on an oil embargo against Russia – but not a complete one
US WTI oil for delivery in July rose up to 3.6 percent to $119 a barrel, the price hitting its highest level in almost three months. The corresponding price for Europe’s leading North Sea variety, Brent, rose by 1.8 percent to just under $124, also approaching a multi-month high.
Looking at the stock markets, Ralf Fayad, who writes about technical analysis for the major French bank Société Générale, does not find the Dax’s breather surprising. He sees the next resistance zone for the Dax at 14,589 to 14,603 points. As support marks, he accounts for 14,510 and then 14,464 points. Below that, a more significant downward correction towards 14,300 points should be planned.
Even that would not be dramatic at first. Since its two-month low of 13,381 points on May 9, the Dax has finally risen sharply amid fluctuations. The recovery has recently gained strength.
In the last two weeks of May, investors always quickly took profits when the Dax was above 14,000 points. Since last Wednesday, however, this mark has been clearly exceeded.
How Far Will the Bear Market Rally Go?
However, many private investors have largely missed the recent upswing. This emerges from the weekly Handelsblatt survey Dax sentiment (Read the analysis here).
Only one in four respondents expects prices to rise in the next three months. Just over a third expect prices to fall. A little more are expecting a sideways movement. So there is no clear market opinion on how the courses will develop.
Technical analysts characterize the rebound as more of a bear market rally, ie a situation in which prices rebound significantly over a shorter period of time before the downward trend resumes with a longer period of falling prices (bear market). Since its all-time high of 16,290 points in mid-November, the Dax has lost more than ten percent, and at the beginning of March it was even more than 20 percent below its all-time high.
Individual values in focus
hellofresh: After the cooking box supplier’s shares rose almost ten percent on Monday, investors took profits on Tuesday. The share loses almost three percent, the share of the food delivery service Delivery Hero gives way even more.
Lanxess: The share of the specialty chemicals group jumps to the top of the MDax with a plus of more than eleven percent. Investors obviously like the fact that Lanxess, together with the financial investor Advent, is taking over the plastics business of the Dutch chemical company DSM for around 3.7 billion euros. This is to be brought into a new joint venture.
Here you can go to the page with the Dax course, here you can find the current tops & flops in the Dax.