DAX index yesterday closed on dovish note while sectorial indices had mixed outcome. Two most popular Dax indices however closed positive for the day. DAX was down by 0.18% while, MDAX & TECDAX were up by 0.62% & 1.70% respectively. While tech shares gave German equities positive influence, loss from Insurance, Food & beverage sectors had serious losses which caused Dax to close in red for the day. European markets were dovish yesterday as investors took to risk averse trading on political woes with impact from escalating French yellow vest protests and Brexit uncertainties. Headlines stating that while EU officials are ready to support PM May in her attempt to push parliamentary approval of Brexit deal, EU is not ready to make any adjustments to deal or negotiate new deal which combined with prevalent safe haven demand saw mixed outcome in European markets yesterday.
Sino-U.S. Outcome To Decide Immediate Future of Broad Market Momentum
Asian equity market opened positive today on prevalent risk appetite in market combined with hopes of positive outcome in Sino-U.S. talks which conclude today. However news of North Korean leader Kim Jong Un visiting China caused investors to go on profit booking spree and take cautious stance which resulted in most major indices turning red ahead of London market hours. Risk appetite however remains high following Powell’s comments last Friday when he stated that fed could pause rate hike plans for 2019 depending on macro data outcome. Moving ahead investors are focused on headlines relating to Sino-U.S. trade talk outcome as favorable outcome would push markets on further Bull Run while negative outcome will result in another bearish equity rout.
Equity markets continue to remain volatile on event filled market. While European markets are embroiled with political and economic woes, there hasn’t been any high impact market news which suggest that price action in German market is expected to be influenced by cues from wall street and Asian markets. DAX futures trading in international market is up by 0.27% ahead of Frankfurt market opening which suggests that Dax index is likely to open positive but trade range bound over cues from international market as investors turned cautious in late Asian hours despite prevalent risk appetite in broad market.
This article was originally posted on FX Empire
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