DAX Index Daily Price Forecast – DAX To Move Range Bound Over Cues from Global Equity Markets

Germany equities were lower at the close on Tuesday, as losses in the Pharmaceuticals & Healthcare, Technology and Retail sectors propelled shares lower. At the close in Frankfurt, the DAX lost 2.17% to hit a new 52-week low, while the MDAX index declined 2.61%, and the TecDAX index lost 3.42%. Declining stocks outnumbered rising ones by 648 to 81 and 51 ended unchanged on the Frankfurt Stock Exchange. The DAX volatility index, which measures the implied volatility of DAX options, was up 2.54% to 19.00. A high level of risk off market sentiment along with bearish price action in both European and US markets on all major indices resulted in German equities ending in red yesterday.

Positive Performance of Chinese & Japanese Equities in Asian Market Hours Indicate Spike in Investor’s Risk Appetite Today

Asian stocks edged lower on Wednesday as concerns, ranging from worries about U.S. corporate earnings to Middle East tensions, weighed on sentiment while crude oil approached two-month lows after Saudi Arabia flagged possible supply increases. Multiple factors are viewed as key factors that resulted in bearish market performance, they are worries about U.S. earnings, Italian government finances, U.S. trade tensions and mounting pressure on Saudi Arabia over the death of dissident journalist Jamal Khashoggi. However Japan and Chinese markets saw positive price action in early Asian hours despite bearish global cues. This could be viewed as result of Chinese indices taking positive cues from US Wall Street whose indices and equity shares ended well off the day’s lows as investors snapped up beaten-down shares late in the session.

The Shanghai Composite is reporting a 0.83% gain after seeing positive movement which went as high as 1.5% increase in early Asian market hours and the S&P 500 futures have recovered losses to trade flat-to-positive. Meanwhile the DAX futures trading in international market are trading with over 0.50% increase in value ahead of Frankfurt market opening. All these factors have led traders to believe that the major European indices may report gains in early trade, helping stabilize the risk sentiment. DAX is expected to open positive but maintain a flat/range bound price action during today’s market hours based on cues from international equity markets.