Dax current: Dax closes near a record – setbacks are currently buying opportunities
Düsseldorf The German stock market continues to improve. On Tuesday, the Dax closed 0.9 percent up at 15,954 points. With its daily high of 15,960 points, the leading index was only 70 points away from its record high in mid-August, which stood at 16,030 points.
It’s a sign of strength. The market was virtually re-evaluated, because there was no trading between the two price levels. As long as the Dax does not close this gap, it is reasonable to assume that the index will reach a new record high in the coming week at the latest.
Martin Utschneider, technical analyst at the private bank Donner & Reuschel, describes this open price gap as a “glimmer of hope, perhaps even as the starting signal for an upcoming year-end rally”.
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Investor sentiment is also signaling a further rise in prices. Sentiment expert Stephan Heibel comments on the evaluation of the current Handelsblatt survey Dax-Sentiment: “Seldom have I measured such a balanced, positive mood.” Investors are optimistic and in a good mood. “But there is no talk of exuberance and a dangerous mismatch between the sentiment and the current market situation,” says the owner of the analysis company AnimusX.
The AnimusX data also suggest a continuation of the rally. There should continue to be smaller setbacks, like last Friday. Indeed that would probably be the basis for the next upward leap.
As a price target, a lot of investors have listed the Dax all-time high from August at 16,000 points. The last week’s post-purchase mark at 14,800 points was raised to 15,200 points.
In addition, the short-term upward trend on the German stock market is intact. After the price slide to 14,818 points on October 6, there were consistently higher weekly lows and highs in the following three weeks, the classic definition of an upward trend.
With yesterday’s daily high of 15,849 points, the Frankfurt benchmark immediately reached a new high in this time window, which was expanded to 15,960 points on Tuesday. As long as the Dax remains above 15,495 points, the low of the previous week, this trend behavior of further rising prices will not change.
Stockbrokers expect a concrete timetable from the US Federal Reserve
Investors are focusing on the US Federal Reserve. The two-day meeting begins on Tuesday, and the results will be announced on Wednesday after the close of trading in Europe. For Thomas Altmann from the investment house QC Partners “there is now consensus that the Fed will announce its exit from the ultra-loose monetary policy tomorrow”.
The stock exchanges are expecting a specific timetable for tapering, the scaling back of bond purchases. “With the recent significant rise in interest rates, the stock exchanges are not only pricing in tapering, but also initial rate hikes,” says Altmann.
Look at individual values
hellofresh: The cooking box supplier Hellofresh is celebrating its tenth anniversary in November with a raffle for Thermomix devices among its customers. The DAX group presented itself with a further increase in the forecast. With this, CEO Dominik Richter was able to dispel doubts that Hellofresh can keep a large part of the customers won during the pandemic, although canteens and restaurants are again well frequented. The stock climbed 17.2 percent.
German Lufthansa: After a buy recommendation, the papers were among the winners in the MDax small cap index. The titles gained 1.3 percent. The analysts from Kepler Cheuvreux have raised the shares to “Buy” from “Hold”.
Fresenius Medical Care: The dialysis provider Fresenius Medical Care (FMC) is fighting against cost pressure and the consequences of the corona crisis with an austerity program. With leaner structures, only two global pillars in the operating model and the reduction of 5,000 jobs worldwide, the subsidiary of the health care group Fresenius aims to reduce annual costs by 500 million euros by 2025. The news was rewarded with an increase of 0.9 percent.
AMS Osram: The Styrian sensor specialist more than doubled its operating profit in the third quarter despite difficulties in the supply chain. AMS believes that the shortage of auto semiconductors will continue well into the coming year. The shortage of chips creates fluctuations in sales and volatility in the supply chains of the automotive industry, since the scarcity of components leads to lower production volumes for the automobile manufacturers. The share fell 5.9 percent.
PVA TePla: After a downgrade, the shares went down. The shares of the high-tech company were among the biggest losers in the SDax with a discount of 5.9 percent. The analysts of the Deutsche Bank had lowered the paper on “Hold” from “Buy”.
Stahlaktien: Papers such as Salzgitter, Klöckner & Co and Thyssen-Krupp were burdened by further falling iron ore prices and lost between three and six percent. Worries about weak demand weighed on the price of iron ore.
The interest rate turnaround is likely to fail on the bond market
Yields on the bond market are falling again significantly. This value for a ten-year federal bond was meanwhile again at minus 0.171 percent this Tuesday.
As recently as Monday, the rate of return peaked at minus 0.07 percent and headed for the highest level in two and a half years. In mid-August, the return was just under 0.5 percent. The ten-year federal bond is the valuation standard for many investments in the euro area.
If investor sentiment has its way, there shouldn’t be a turn towards positive interest rates for the time being. A week ago, sentiment expert Stephan Heibel pointed out the extremely bad mood, coupled with a high willingness to buy, on the bond market and considered rising prices for the Bund future to be likely. Which also happened. “It is too early for a turnaround in interest rates,” Heibel affirmed yesterday, Monday, his view of a week ago.
The Bund future futures contract relates to a fictitious, long-term federal bond with a coupon of six percent and a term of ten years. When the yield on government bonds rises, the price of the Bund future falls and vice versa. This construct enables investors to bet on rising or falling returns.