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DAX Index Daily Price Forecast – DAX To Trade Dovish On Cues From International Market

Colin First

Germany equities were higher at the close on Wednesday, as gains in the Utilities, Consumer & Cyclical and Pharmaceuticals & Healthcare sectors propelled shares higher. At the close in Frankfurt, the DAX added 0.20%, while the MDAX index climbed 0.52%, and the TecDAX index climbed 0.58%. Advancing stocks outnumbered falling ones by 478 to 256 and 42 ended unchanged on the Frankfurt Stock Exchange. The DAX volatility index, which measures the implied volatility of DAX options, was down 0.60% to 23.25. European markets had mixed outcome yesterday as investor sentiment remained dovish on risk averse trading activity amid concerns of global economic slowdown.

US Macro Data & Political Events Are Main Focus of The Day

Equity markets suffered further on news of rare revenue warning from Apple Inc., which caused major global currencies to take sharp dovish dive while Asian equities also suffered on said news. Major bears driving the market momentum were mostly from tech shares which were affected over comments from apple. However downside was limited and Asian shares took to mixed performance on headlines from China which stated that Chinese central bank is adjusting policy to benefit more small firms which are having trouble obtaining financing, in its latest move to support the cooling economy. While equity markets took to mixed price action, indices from all major Asian markets closed in red suggesting that bear’s grip on market remains tight despite normal trading activity resuming post holiday season.

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Investors continue to approach market with caution as they await cues from key geo-political events before placing major bets. In near future major events that could change the direction of fund flow are – new congress swearing into power later today, US NFP and speech from Fed Chair Jerome Powell scheduled for tomorrow. DAX futures trading in international market were down nearly 1% ahead of European market hours suggesting that German equities are to face bearish price action today. Dax index is expected to trade bearish across the day over cues from international market but downside is likely to remain limited on constrained trading activity ahead of key events.

This article was originally posted on FX Empire

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