The combination of inflation risks and growth worries will also get on investors’ nerves in the new week. “Falling DAX profit expectations speak for a sustained, nervous swing on the German stock market at least until autumn 2022,” says Commerzbank strategist Andreas Hürkamp. Between hope and fear, the DAX went up and down in the past few trading days. On Friday, the leading index was once more well above the 14,000 mark at the daily high of 14,161 points, but then fell back below the threshold from the 14,000 mark with 13,982 points trade passed. But at least with a surcharge of almost 100 jobs or 0.7 percent. Searching for direction was also popular on Wall Street. The DAX is currently valued at around 14,100 points.
Persistently high inflation remains a concern and is already weakening the profitability of major US retailers. “If investors’ worst fears regarding the dwindling purchasing power of consumers are confirmed, this would be bad news for the stock market,” says analyst Konstantin Oldenburger from online broker CMC Markets. After all, the consumer is an important factor in avoiding a recession.
Investors are also nervous regarding a tense situation in the energy sector following Russian supplies are falling more and more because of the Ukraine war. The conflict and its consequences will also determine the debates of leaders from politics and business at the World Economic Forum in Davos, which takes place until Thursday.
In any case, the numerous negative factors are likely to affect the mood of German companies more and more. Experts are counting on the upcoming morning Ifo business climate in May with an average decrease to 91.4 from the previous 91.8 points. In the followingnoon, data from the USA will follow Business climatethe Chicago Fed National Activity Index and the semi-annual ISM Economic Outlook.