DAX Index Daily Price Forecast – DAX To Move Range Bound on Macro Data Outcome

Germany’s DAX index closed positive last week supported by high risk appetite among investors and bullish influence from Asian market over news of China’s central bank modifying its monetary policy to suit even needs of small scale business. A look at sectorial indices performance in Frankfurt stock exchange suggests that gains in German equities were dominated by shared from Basic Resources, Pharmaceuticals & Healthcare and Construction sectors. Frankfurt market closed on Friday with positive outcome as three major indices DAX, MDAX & TECDAX up by 3.37%, 2.99% & 3.23% on the day. However sharp upside move was prevented owing to mixed outcome in macro calendar as German Composite & Services PMI saw highly dovish readings when compared to previous readings and forecast data while German unemployment data had slightly better than expected outcome.

Cues From International Market Will Prevent Downside Move

All major Asian indices are trading positive since trading session began for the day supported by cues from Wall Street which saw major indices and overall equity share performance take sharp upside move supported by better than expected US NFP data and comments from Fed Chair Powell which hinted at possibility for rate hike pause in 2019. Asian markets also continue to receive positive support from China on lingering influence from Chinese central bank’s policy modification update. Risk appetite remains high in forex and equity markets alike as one of most anticipated event in global markets – face to face meet between representatives for Sino-U.S. trade negotiations begins today. Representatives are expected to discuss about key issues such as intellectual property theft and U.S. government’s order to US companies to avoid products from Chinese companies like Huawei.

The outcome of this meet is expected to provide clues on how relation between two countries will be which will in turn greatly affect global market performance.  German market is highly susceptible to changes in US & Chinese markets owing to highly trade dependent nature of German economy. DAX Futures trading in international market is up by 0.17% on the day ahead of Frankfurt market opening which suggests that DAX index will open positive today. German index could trade positive across the day but price action is expected to remain range bound as macro data in Euro area has mixed forecast and worse than expected outcome could hamper risk appetite of investors.