DAX higher at the start: How a “pigeon” takes courses

Market report

As of: 08/30/2021 9:46 am

The German leading index DAX has started the new week with a broad chest. The moderate tones of the monetary dove Jerome Powell are popular in the global stock markets.

As in defense policy, there are hawks and doves in monetary policy. On the stock exchange, representatives of a loose monetary policy, which focuses on measures to support the economy, are referred to as pigeons. The hawks, on the other hand, are fans of a more restrictive pace, they attach great importance to monetary stability.

Above all, the pigeons are welcome guests on the stock markets, after all, the ultra-loose monetary policy of the global central banks is one of the most important price drivers in recent years.

Powell is in no hurry

Against this background, it is hardly surprising that Jerome Powell, with his “deaf” tones, is again attracting more investors to stocks in this country. With his speech at the virtual central bank conference in Jackson Hole on Friday, the head of the US Federal Reserve (Fed) tended to meet the wishes of those who had hoped for relaxed monetary policy statements.

“After Powell’s remarks, it does not appear as if the Fed is in any great hurry to get out of the expansionary monetary policy,” commented Commerzbank foreign exchange analyst Thu Lan Nguyen this morning. A repayment of the bond purchases as early as September is rather unlikely.

The decreasing fears of investors about an imminent tightening of the monetary policy reins are also having a positive effect in this country. The DAX starts trading at 15,857 points, slightly above the previous day’s closing price.

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As long as the leading German index can stay above its old breakout mark of 15,800 points, it will keep its chances of new records above its current record of 16,030 points.

In the further course of trading, the data on German inflation should move into the focus of investors in August. The Federal Statistical Office wants to present the first preliminary figures at 2 p.m. today. In the previous month, inflation was 3.8 percent compared to the same month last year and thus reached a high for almost 30 years.

The inflation data are the prelude to a “week of macro data”, as the market strategists at Credit Suisse emphasize. On Tuesday consumer prices in the euro zone and on Friday the US labor market report for August will be in focus.

Tailwind for the DAX is coming from the US stock exchanges. The Dow Jones index of standard values ​​closed on Friday 0.7 percent higher to 35,455 points. The US leading index is still 175 points short of its now almost two-week-old record.

In contrast, the New York indices Nasdaq and S&P reached new record highs. The technology-heavy Nasdaq advanced 1.2 percent to 15,129 points. The broad S&P 500 gained 0.9 percent to 4509 points.

The good specifications from Wall Street are also having a positive effect on the Asian stock exchanges at the beginning of the week. The Japanese Nikkei Index, comprising 225 values, was 0.5 percent higher at 27,789 points at close of trading in Tokyo. The Shanghai stock exchange is 0.1 percent up.

A potential risk factor for the stock markets, however, remains the oil prices, which had risen more strongly in the past week than they had been in 14 months. At the beginning of the week, the price of a barrel (159 liters) of North Sea Brent rose by another 0.2 percent to 72.82 dollars. A barrel of WTI oil costs $ 68.55.

The background to this is the destructive hurricane “Ida”, which interrupted oil production in the Gulf of Mexico. The region covers 17 percent of US crude oil production, and more than 45 percent of the refining capacity is along the coast. So far, however, the effects on the production facilities seem to be limited.

The dollar has been under slight pressure against other currencies since the Powell speech, as the US Federal Reserve chief did not have a precise schedule for “tapering”, ie reducing bond purchases, at hand at the Jackson Hole conference. In return, the euro temporarily climbed above the $ 1.18 mark. Currently, 1.1796 dollars are paid for one euro.

The weakening dollar had already given the gold price a boost at the end of the week. The yellow precious metal was able to regain the psychologically significant $ 1,800 mark. At the beginning of the week, an ounce of gold costs $ 1,813, 0.3 percent less than on Friday.

Qiagen is moving into focus on the German stock market. The biotechnology and diagnostics company is aiming for takeovers and could delight its shareholders with dividend payments in the future. “We are currently very active,” said CFO Roland Sackers of the “Börsen-Zeitung” with a view to acquisitions. The group is very interested in expanding the test portfolio or further access to bioinformatics.

The online broker Flatexdegiro has announced a share split. Shareholders received three additional share certificates for each paper. This is intended to further increase the liquidity of the share and to make the ownership of shares even more easily accessible for investors. The procedure is expected to take effect on September 2, 2021.

Japan has again detected contamination in an ampoule of Moderna’s Covid-19 vaccine. A very small, black substance was found in a vaccine vial from Moderna, according to an official from Gunma Prefecture. Just last week, Japan stopped using 1.63 million doses of Moderna after domestic distributor Takeda Pharmaceutical received reports of contamination in some vials.

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