DAX Index Price Forecast – DAX Turns Range Bound Post Euro Zone Macro Data Update

Germany equities were mixed at the close on Monday, as gains in the Software, Financial Services and Food & Beverages sectors propelled shares higher while losses in the Pharmaceuticals & Healthcare, Retail and Construction sectors led shares lower. At the close in Frankfurt, the DAX fell 0.53% to hit a new 1-month low, while the MDAX index climbed 0.11%, and the TecDAX index gained 0.52%. Declining stocks outnumbered rising ones by 418 to 299 and 62 ended unchanged on the Frankfurt Stock Exchange. The DAX volatility index, which measures the implied volatility of DAX options, was up 1.43% to 18.19 a new 1-month high. European stocks rose Tuesday, putting a pan-European index on the verge of booking a gain for the first time in three sessions as Turkey’s currency meltdown showed signs of steadying influenced by investors’ attempts to shake off worries about the deterioration of Turkey’s currency, and a possible spillover effect from that decline.

DAX Gains Positive Influence From Better Than Expected German Macro Data

Traders resumed tentatively buying stocks on the back of healthy economic reports. This resulted in DAX opening with a gap up on Tuesday’s European market hours. However the gains made in early hours were erased thanks to mixed macro data outcome in German and Eurozone macro data updates. German inflation data remained mostly unchanged except for YOY GDP which was at 2.3% vs forecast of 2.5% but this reading is still better than previous reading which was at 1.4%. Meanwhile German MOM GDP, ZEW current conditions & Economic sentiment were positive with better than expected readings. Eurozone data however put a dent on investor mood as industrial production data took a hit on both MOM/YOY readings despite positive GDP & ZEW Economic sentiment readings which affected key markets across Europe and market saw dovish cues which resulted in German index DAX losing gains made at start of the day.

As of writing this article, German DAX is at 12398.62 up 0.25% on the day. Aside from dovish Eurozone industrial production data, Turkish crisis also continues to weigh down European markets as Economic action plan from Turkey failed to have expected impact on Turkish Lira despite the currency stabilizing. US markets yesterday closed on red which influenced key Asian markets such as China & Singapore to trade and close in Red. Hence international cues and support to German market can also be viewed as dovish influence. German DAX is expected to make range bound momentum across today’s market hours over positive influence from better than expected local economic data and dovish cues from international market.