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DAX Index Daily Price Forecast – DAX To Trade Positive On Improved Investor Sentiment

By:
Colin First
Published: Mar 1, 2019, 11:20 UTC

Dax to trade positive on cues from the international market but macro data outcome eyed for possible directional cues.

DAX Friday

The European equity market yesterday saw mixed price action in major European stock exchanges. The mixed price action was influenced by divided investor sentiment is as the market is still reeling from Brexit proceedings. EU Chief Negotiator Michel Barnier commented recently that while Europe is open to extending the deadline for Brexit, he feels it is pointless unless the UK parliament focuses on address the key issues and aims at Brexit deal instead of postponing the problem. The comment is not far from the truth as two of UK parliament sessions from the month of February saw critical decisions being postponed despite all the hype about making decisions during said meetings.

German Bond Yields Underpinned Market Bulls Yesterday

Meanwhile, the spike in German government bond yields provided support to Euro and boosted investor sentiment and this is viewed as a positive fundamental factor in the market. Backed by hawkish influenced coming from German bonds German equity market saw major indices and equities closed on positive note. However, a look at sectoral indices data shows that price action in the Frankfurt stock exchange was divided despite benchmark indices closing in green at end of the trading session yesterday. Out of a total 778 stocks trading in the exchange, 359 stocks closed in red while 82 closed unchanged at end of trading session. As per data on the performance of sectoral indices from the Frankfurt stock exchange, 10 of 18 sectoral indices closed in the red. Despite this outcome from a sectoral perspective, major benchmark indices in the exchange closed positive for the day as stocks from the Retail, Pharma & Healthcare, and the software sector suffering most gains and out overall performance in bullish territory.

At end of trading session, the three major indices DAX, MDAX & TECDAX closed for the day with 0.25%, 0.56% & 0.38% on the day. Major indices and equities in Asian markets saw positive price action as risk appetite returned to the market following upbeat macro data from the US and there are no high impact events scheduled today. As trading session approached the week’s closing retail trading activity is high with most traders looking to book profits on today’s macro data filled calendar schedule. However, concerns of an economic slowdown in China and concerns regarding further proceedings in Sino-U.S trade talks capped gains in major Asian markets. DAX futures trading in the international market ahead of the Frankfurt market opening was up by more than 1% on the day. This combined with positive cues from the international market is likely to influence positive price action in the German equity market today. However, depending on the outcome of German manufacturing PMI & unemployment data there is a chance for sideways price action in DAX today.

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About the Author

Colin specializes in developing trading strategies and analyze financial instruments both technically and fundamentally. Colin holds a Bachelor of Engineering From Milwaukee University.

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