Dusseldorf The German stock market continues sideways. The Dax was listed at 15,847 points in the first hour of trading, a drop of 0.1 percent.
The past trading days have shown that the leading German index lacks momentum, power and strength in the upward movement. Whenever the Dax reaches a new high for the year, it cannot maintain this mark in the further course and slips down again.
This scenario also existed yesterday, Monday, when the stock market barometer marked the highest level of the year with 15,919 numbers, but ended trading at 15,863 points.
At the same time, the trading volume in the leading German index slipped to its lowest level in two months at the start of the week with 50.5 million shares traded. On average, 75 million pieces changed hands every day in the past three months.
A lack of momentum and a low trading volume allow the conclusion: only a few stockbrokers believe that an entry at the current prices is worthwhile. Instead, more and more are waiting for a setback and the first bargains.
This is also confirmed by the results of the Handelsblatt survey Dax-Sentiment. According to the survey, investors’ willingness to invest has fallen to its lowest level in two years.
>> Read here: Worse mood among investors than in the pandemic – but price losses should be an opportunity to get started
The current low level of fluctuation is not just a German problem. Because according to Jörg Scherer, technical analyst at HSBC Germany, the high-low range of the past six trading days on the US stock market barometer was just 55 points. Last week saw the smallest weekly trading range since September 2021.
S&P 500 is also facing an important mark
This all has to do with the important brands that are on the agenda of both the Dax and the S&P 500. In Germany it is about 16,000 points and, if successful, the record high of 16,290 points.
On the other side of the Atlantic, prices above 4200 points on the S&P 500 would pave the way for further price gains according to chart technology. It’s hard to believe that the Dax will reach a new record high and the S&P will remain at the current level. Yesterday, Monday, the world’s most important stock market barometer closed at 4137 points.
Such small trading ranges are usually followed by dynamic price movements. The motto here is: the longer this rather listless sideways phase lasts, the more dynamic the breakout will be.
It is quite possible that the Dax will slip back towards 15,000 points. But with a look at the behavior of the various investor groups, these are likely to be entry prices rather than the harbingers of a crash. According to the evaluation of the Handelsblatt survey Dax-Sentiment, the sentiment expert Stephan Heibel is also certain: “It takes a negative surprise to push the stock markets significantly down”.
Especially since a look at the Dax chart shows that the short-term upward trend is also intact. Every week since March 20th there has been a new high and a higher low, the classic definition of an uptrend. And as long as the Frankfurt benchmark remains above 15,706 points up to and including Friday, this upward trend would then enter the seventh week.
“On balance, it is still not the worst starting position to exhaust the price target of a good 16,000 points from the bottoming out in March and thus also to set course for the previous all-time high of November 2021 at 16,290 points,” says Jörg Scherer.
Then it should be exciting to see how the many current bargain hunters react. Are you then still waiting for entry prices, or are you abandoning your wait-and-see stance and adding momentum to the rally?
US technology companies present figures
The numbers of the US technology groups Microsoft and Alphabet, the Google parent company, have the potential for new price movements. Both companies will present their numbers after the US stock market closes, and Amazon and Facebook parent Meta will follow this week. For Konstantin Oldenburger from CMC Markets, “it would not be the first time that the companies also move the overall market in one direction or the other”.
The four stocks have gained between 18 and 70 percent this year. At approximately $5.1 trillion, their combined market cap accounts for around 15 percent of the total market cap of the S&P 500. In the Nasdaq 100 index, the four even have a weighting of 30 percent.
US stock market expert Koch: “Uncertainty before the tech results”
“If the companies manage to exceed expectations, this could provide a further positive boost on the stock market,” believes Oldenburger. “On the other hand, a performance like Tesla’s last week is likely to shake the stock market before the important Fed meeting next week.”
Look at the individual values
Team viewer: Shares are up 5.1 percent. According to a trader, analysts at Goldman have upgraded the rating to Buy from previously Neutral.
Fielman: The stocks of the optician chain rose by 4.7 percent after the analysts at Berenberg put the stock on “hold” from previously “sell”.
Jungheinrich: The share price benefits from the upward screwed sales and profit forecast after the takeover of the US logistics specialist Storage Solutions. The titles of the Hamburg forklift manufacturer climb by 7.5 percent.
Two companies are trading at a dividend discount on Tuesday. Airbus pays 1.53 euros, the closing price on Monday was 127.70 euros. Henkel paid 1.85 euros at a closing price on Monday at 74.26 euros.
Here you can go to the page with the Dax course, here you can find the current tops & flops in the Dax.