After the Dax has not consistently exceeded 16,000 points in the past two weeks, this could remain the case for a while. Little movement is also expected for the US leading index Dow Jones Industrial. In the new week, in addition to further company figures and fresh economic data, investors should focus primarily on the possible default by the US government. The German Stock Exchange opened next Thursday despite the Ascension Day holiday.
After the Dax has not consistently exceeded 16,000 points in the past two weeks, this could remain the case for a while. Little movement is also expected for the US leading index Dow Jones Industrial. In the new week, in addition to further company figures and fresh economic data, investors should focus primarily on the possible default by the US government. The German Stock Exchange opened next Thursday despite the Ascension Day holiday.
On Friday, the leading German index Dax made up for its moderate losses from the previous day and closed with a plus of 0.50 percent at 15,913.82 points. This resulted in a weekly loss of around 0.3 percent.
According to Robert Halver, capital market analyst at Baader Bank, the shares are currently lacking the kick of fresh impetus. “Since the economic risks have recently become the focus of investors again, the stock markets are losing their fundamental strength. At the same time, however, the economic slump is benefiting the easing of inflation, which is making it easier for the central banks to start the exit from the interest rate turnaround,” explained Halver. For the time being, he continues to expect rather little movement in the stock indices.
Democrats and Republicans in the US
Meanwhile, a potential US government default is looming with serious consequences for financial markets if Democrats and Republicans don’t agree on raising the debt ceiling soon. According to Commerzbank analyst Esther Reichelt, this issue ranks above considerations of how long the US Federal Reserve can hold on to an interest rate pause.
With a view to the still ongoing quarterly reporting season of German companies, Commerzbank expert Andreas Hürkamp pointed out that local corporate profits continue to develop better than expected.
A large number of quarterly figures are also on the agenda for the new week. The Dax members Commerzbank, Munich Re, Porsche SE, Siemens and Siemens Energy will report on their latest business development. The wind and solar park operator Encavis and the insurer Talanx, among others, present their key figures from the MDax.
German order situation weak
In terms of the economy, the situation currently appears to be more gloomy than better. Market strategist Uwe Streich from Landesbank Baden-Württemberg (LBBW) even sees the recent extremely weak figures for German incoming orders and local industrial production as a sign of a recession. He also sees the US economically losing more and more ground.
Data on the latest economic developments will therefore be of interest in the new week. For the eurozone, industrial production (March) will be released on Monday, gross domestic product (GDP/Q1) on Tuesday and final inflation data (April) on Wednesday.
In the US, April retail sales and industrial production are likely to receive more attention on Tuesday. The final April inflation figures will follow on Wednesday. In Germany, the ZEW Institute will publish the economic expectations surveyed by financial experts on Wednesday. On Friday, the German producer prices round off the week.
Source: Stern
