Dusseldorf There is an impressive start to the year on the German stock market: the Dax has risen significantly for the third trading day in a row. The leading index closes at 14,491 points on Wednesday, an increase of 2.2 percent and more than 300 points. Since the beginning of the year, the stock exchange barometer has already increased by more than 560 points.
The strong start to the year on the German stock market puts immediate pressure on everyone who was uninvested or underinvested at the beginning of the year. And their purchases now have the potential to push the Dax further.
Capital market expert Thomas Altmann from the investment house QC Partners dares to make a prophecy before the start of trading: “If the Dax rises for the third day in a row today, many will no longer ask themselves whether they want to buy. Then it becomes a must-buy.”
A year ago, the so-called January effect, which means significantly higher prices in the first few days and weeks, ended on the third day of trading. At that time, the leading index rose to its high for the year of 16,290 points and slipped by around eight percent within three weeks before the market stabilized again and was ultimately able to halve the January loss.
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However, it is unlikely that this scenario will repeat itself. After a year of losses like 2022, the question is whether there will be a significant decline from mid-January or whether prices will continue to climb.
>> Read here: The decisive stock market month – what the “January effect” says about 2023
Perhaps the 2012 stock market year will serve as a blueprint for 2023. After a minus of 14.7 percent in 2011, prices climbed by twelve percent in January 2012 without any significant setback.
A few weeks later, however, there was a sharp correction of 20 percent until the beginning of June. This not uncommon seasonal pattern in the Dax would also match the expectations of many stock market strategists, who warn of a difficult first half of the year. Ultimately, however, the stock market year ended with a plus of 29 percent, which is not a guideline for 2023.
What the Dax chart technology says
With the price gains, the Frankfurt benchmark has reached the next level up. This is the sideways range with 14,150 points on the bottom and 14,584 points on the top. With today’s closing level, the Dax has already reached the upper half of this range.
In addition, there was only a brief jump to 14,675 points, but this can only be seen as a slip. But that’s where the high of the 2700-point rally since the end of September last year is.
It would be a real surprise if the leading German index could break through the range between 14,800 and 15,000 points. This zone provided support for the Dax from the beginning of April 2021 to the end of February 2022. After breaking this mark in the course of the Russian invasion of Ukraine, it has become an important resistance according to the chart technique.
Oil price falls
The mood on the commodity markets remains gloomy. Yeap Jun Rong, market analyst at IG Markets, says: “Warning signs of a global recession, China’s lackluster recovery with rising Covid-19 cases, renewed US dollar strength and muted risk sentiment are all triggering factors that sent oil prices in overnight held her spell.”
The North Sea oil grade Brent and the US grade WTI are expanding their losses from Tuesday and are each 4.6 percent lower at 78.36 and 73.44 dollars per barrel (159 liters).
New inflation data
The French inflation rate followed the German inflation rate this Wednesday. The inflation rate in France – calculated according to comparable EU standards – fell unexpectedly to 6.7 percent in December, after a record 7.1 percent in November. Experts surveyed by the Reuters news agency had even expected a further increase to 7.2 percent for December.
Finance Minister Bruno Le Maire told radio station France Inter that inflation will level off over the course of 2023. He recently stated that inflation should remain high until the middle of the year.
The decline is a positive sign. Because only if inflation in the euro zone falls across the board can this have an impact on the monetary policy of the European Central Bank (ECB).
Look at the individual values
RWE: RWE shares, which performed well in 2022, came under pressure again and fell by 2.4 percent at the end of the Dax. The papers of the energy company had already lost almost five percent the day before.
limit: The leasing specialist Grenke did significantly more new business in 2022 and reached the upper end of the forecast range raised in October. The share, which is listed in the SDax small-cap index, went up and down. After an increase of 7.4 percent, the loss in value was even 6.9 percent in the meantime. At the end of trading, the stock was up 0.7 percent.
DIC asset: The company sells another commercial property. The “Kaufhof Chemnitz” property will go to the Krieger Group, the company announced on Wednesday. It was agreed not to disclose the sale price. The furniture store chain Höffner belongs to Krieger. With the transaction, DIC Asset achieved its goal of sales proceeds of EUR 400 to 500 million. The stock rose 2.7 percent.
Here you can go to the page with the Dax course, here you can find the current tops & flops in the Dax.