Dusseldorf The Dax reacted to good economic data on Tuesday morning with a small setback. After the start of trading, it was initially listed close to the closing price on Shrove Monday. On the highest holiday of the carnivalists, the leading German index went out of business with 15,478 points.
After the preliminary purchasing manager indices were published, the Dax turned negative. He loses more than one percent and is listed at 15,303 points.
According to the purchasing manager survey by the financial services provider S&P Global, the German economy has grown again for the first time in six months. With a value of 51.1 points, the purchasing managers’ index for the private sector in February broke the growth threshold of 50 points. Economists had only expected a slight increase to 50.4 points. This makes a severe winter recession less likely.
However, the data are not good enough for economic optimism, judges Ulrich Wortberg, market analyst at Helaba. “Overall, the figures suggest weak economic momentum. Nevertheless, the mood indicators will probably not deter the ECB from raising interest rates.” This is causing frustration among investors.
The results of a monthly survey of stock market professionals published late in the morning by the Leibniz Center for European Economic Research (ZEW) provide further information about economic development in Germany. They are regarded as early indicators of economic development in Germany. Analysts also expect slight improvements here.
With the current listing, the German stock exchange barometer remains within the narrow trading range of the past few weeks. On the top is the annual high of 15,659 points from February 9th. On the downside, the area between 15,250 and 15,275 points is a resistance. Only when the Dax breaks out of this range of 400 points will there be a lasting change in the direction of the German stock market.
Stock market strategists expect prices to continue to rise. Because in stock market history, a weak year with losses – like 2022 – was always followed by a strong one. However, in these strong years, significant course corrections usually took place before the summer.
Investors are now trying to anticipate this setback and are risk-averse in the meantime. They don’t want to be caught unawares by falling prices and instead look for profit-taking.
>> Read also: This allows investors to benefit from corrections in the stock market
The market observers at Helaba are dampening hopes of concrete indications from the new data. The picture of the economic situation will remain vague. Because the data should not be “good enough to spread economic optimism, but also not weak enough to dissuade the ECB from raising interest rates,” writes the Hessisch-Thüringische Landesbank in an analysis.
Impulses from the reporting season
In addition, the reporting season continues on Tuesday. Among others, the US retail group Walmart, the US medical technology group Medtronic and the French IT consulting giant Capgemini are opening their books. The major British bank HSBC had already announced before the European stock exchanges opened that they would have increased their profits in 2022.
In the afternoon, further impetus could come from Wall Street. After the holiday-related break on Monday, however, analysts are expecting a weak trading day here as well. Because one day before the minutes of the last interest rate meeting of the US Federal Reserve are published, many are likely to remain in a waiting mood.
The so-called Fed Minutes show how unanimously the decision to raise the key interest rate by 0.25 points at the beginning of February was made. From this information, investors try to figure out how the Fed’s interest rate policy could turn out. Further interest rate hikes are likely to cause pessimism in the markets.
Look at individual values
Adva Optical Networking: The Bavarian network supplier met its goals in the past year. At 712 million euros, sales in 2022 were within the forecasts of 680 to 730 million euros, which were lowered in the summer, as the company announced on Tuesday. Net profit, on the other hand, collapsed by two-thirds. The Adva share loses 0.3 percent, but supports its parent company, the US telecom equipment supplier Adtran, whose shares in Frankfurt have risen by almost two percent.
Commerzbank: Even today, the rise in the Dax-40 moves the stock market price of the financial institution. On February 27, Germany’s second largest private bank will replace industrial gases specialist Linde in the index, which has withdrawn from the Frankfurt Stock Exchange. The papers started the trading day with a plus of two percent, but gave up the gains again in the morning.
German Stock Exchange: The analysts of the investment bank Jefferies changed the share from “buy” to “hold” and lowered the price target to 190 from 210 euros. This puts a strain on the share certificates of the stock exchange operator, they have lost more than three percent in the meantime, and in the morning they were 2.6 percent in the red.
Rheinmetall: The promise of the German industry to deliver armored personnel carriers to the Ukraine gives the armaments company further rising prices. The share, which is listed in the MDax, has increased by more than one percent.
Here you can go to the page with the Dax course, here you can find the current tops & flops in the Dax.