DAX Index Price Forecast – DAX To Trade Positive On High Risk Appetite Surrounding Global Equities

Germany equities were mixed at the close on Thursday, as gains in the Food & Beverages, Pharmaceuticals & Healthcare and Insurance sectors propelled shares higher while losses in the Technology, Chemicals and Construction sectors led shares lower. At the close in Frankfurt, the DAX added 0.40%, while the MDAX index fell 0.12%, and the TecDAX index declined 0.65%. Major indices and equities across key European markets closed on positive note on Thursday despite bearish signs at early European market hours following FOMC statement. US equities closed on positive note on Thursday supported by hawkish comments from Fed Chair Jerome Powell’s speech yesterday in which he mentioned that the U.S. does not face a large chance of a recession in the next two years and the Federal Reserve plans to keep gradually raising interest rates.

Major Global Indices Move Positive In Response To Dollar’s Strength

Shares in Asia inched higher on Friday, following gains on Wall Street overnight after news of robust U.S. economic growth. Japan’s Nikkei hit a 27-year high today taking heart from a boost for the dollar after the Federal Reserve chairman said he did not expect a near-term recession, and strong gains on Wall Street overnight. Japan’s Nikkei stock index rose as high as 24,286.10 points, reaching its highest levels since November 1991, on renewed optimism about the global economy and hopes of a boost to exporters’ earnings from a weaker yen. Due to Fed’s methods of handling rate hike decisions and forward guidance, the trend were dollar strength and equities didn’t go hand in hand in recent past has changed and various indices across globe have reached new high’s directly in response to US Greenback’s strength in broad market.

The outlook for dollar remains positive in long term owing to multiple factors such as public view of USD as safe haven, future rate hike expectations and ongoing trade war in multiple fronts which has in the past boosted the USD in broad market. However with investors getting used to dynamics of market working on such scenarios repeatedly the trade war impact is being lesser on market as days progress and risk appetite remains high in equity market among investors. While DAX futures trading in international market is currently moving dovish, it traded positive in early market hours and investor sentiment surrounding equity markets remain positive supported by high risk appetite among investors and positive cues from international allies which are trading hawkish today indicating possibility for German DAX index to move with positive tone even if index turns range bound during today’s market hours. German DAX has closed positive for three consecutive trading session so far despite mixed signals at time of market opening and a positive market closing today would indicate high risk appetite among investors remains solid despite Italian budget woes.