DAX Index Price Forecast – DAX Index Fell On Global Cues Post Three Consecutive Bullish Trading Sessions

Germany equities were mixed at the close on Thursday, as gains in the Software, Retail and Technology sectors propelled shares higher while losses in the Basic Resources, Pharmaceuticals & Healthcare and Media sectors led shares lower. At the close in Frankfurt, the DAX fell 0.16%, while the MDAX index climbed 0.36%, and the TecDAX index climbed 0.89%. Declining stocks outnumbered rising ones by 364 to 327 and 89 ended unchanged on the Frankfurt Stock Exchange. The DAX volatility index, which measures the implied volatility of DAX options, was down 2.16% to 15.02. Equity markets across globe took a bearish hit yesterday as investors took to risk aversion sentiment on news of US & China imposing 25% tariff on goods imported from respective countries, the two day Sino-U.S. meet ended with no breakthrough as Trump had commented earlier. Investors chose to move their funds towards US Greenback as a safe haven instrument but the momentum from this move and hawkish fed update failed to make serious gains as rally died down on early Friday’s market hours with investors opting to focus on Fed Chair Jerome Powell’s speech to re-affirm his stance on future rate hikes.

Investors Await German GDP & Fed Powell’s Speech Before Placing New Bets

All Key European and US equity markets closed on dovish note yesterday down by .010% to 0.30% as geo-political woes and fear of trade war resuming in Europe over Trump’s comment on tariff for European goods weighed down the investor sentiment. Key Asian markets on Friday morning saw mixed performance with China’s Shanghai Composite & Japan’s Nikkei225 trading positive while Singapore’s FTSE STI & Hong Kong’s Hang Seng trading down trend. Global risk sentiment remains somewhat jittery ahead of Fed Chair Powell’s speech with U.S.-Sino trade talks failing to yield any immediate progress, for equities, the key point will be whether Powell indicates that the Fed is poised to hike rates two more times this year. That would fall in line with expectations and not cause much of a stir.

Any mention of recent turbulence in the emerging markets may also provide the risk asset markets with some relief. However Euro picked up strength in early hours of Friday’s market session indicating positive sentiment lingering in market despite cautious tone. This is further supported by the fact that DAX futures which are trading in international market ahead of European market hours was up by 0.10% on the day. German market is expected to open on positive note and maintain a near flat performance ahead of German GDP data which is forecast to remain unchanged. A better than expected German GDP data could help DAX remain upside across European market hours even if there is dovish influence from international market.