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Frankfurt Stock Exchange: Losses in the Dax ahead of monetary policy signals from the USA

Frankfurt Stock Exchange: Losses in the Dax ahead of monetary policy signals from the USA

The German stock market suffered further losses on Tuesday due to the ongoing uncertainty following the European elections. Investors are also still waiting for the inflation data and monetary policy signals from the USA due on Wednesday. At the end of trading, the DAX was down 0.68 percent at 18,369.94 points. However, it remained above its daily low reached after the US trading opened, which also meant the lowest level for the leading index in over a month. The MDax of medium-sized German companies ultimately fell by 1.06 percent to 26,457.33 points.

The EuroStoxx 50, the leading index for the Eurozone, fell by around one percent. The British FTSE 100 lost a similar amount, while the French Cac 40 slipped even further into the red. On the New York stock exchange, the US leading index Dow Jones Industrial was able to limit its losses to 0.6 percent by the end of European trading, while the technology-heavy Nasdaq 100 made up for its losses.

For the US interest rate decision on Wednesday evening, it is firmly expected that the Federal Reserve will leave the key interest rate unchanged. However, the associated statement and the subsequent press conference by Fed Chairman Jerome Powell could provide clues about future interest rate policy. Before that, data on the development of consumer prices is expected on Wednesday, which could also provide information about the timing of the first interest rate cut in the USA since the big wave of inflation.

French bank shares in particular suffered again from the politically explosive situation on the other side of the Rhine. In the DAX, Commerzbank and Deutsche Bank were the biggest losers, each with price declines of more than 3 percent. In contrast, Covestro shares topped the DAX with a plus of 7.1 percent, reaching their highest level in almost two months. According to insiders, progress has been made in the takeover talks between the German plastics manufacturer and Adnoc, the state-owned oil company from the United Arab Emirates.

Investors in printing machine manufacturers focused on a review of the Drupa trade fair. Koenig & Bauer reported a positive order intake. Competitor Heidelberger Druck also received a large number of orders at the fair, apparently leading to a recovery in incoming orders. However, Koenig & Bauer shares only rose by 0.7 percent, after temporarily reaching a high since mid-September. Heidelberger Druck was one of the biggest winners in the SDax small cap index, rising by 3.8 percent. Hapag-Lloyd shares, meanwhile, fell by 9 percent in the wake of heavy losses at major Asian shipping companies.

On the foreign exchange market, the euro fell to 1.0734 US dollars. The European Central Bank (ECB) had previously set the reference rate at 1.0730 dollars, meaning the dollar cost 0.9319 euros. On the bond market, the yield on outstanding bonds rose from 2.70 percent the day before to 2.71 percent. The Rex bond index fell by 0.05 percent to 123.38 points. The Bund future gained 0.39 percent to 130.16 points.

Source: Stern

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