This is all the more true as the risks have changed little. The highly valued US technology stocks have lost ground, but it remains questionable whether this is the end of their correction. Concerns about the economy have not yet been dispelled either. This is particularly true for the USA. Expectations of interest rate cuts have increased, but it is uncertain whether this will be enough to put the markets on a growth path.
Portfolio manager Jens Herdack from Weberbank expects continued fluctuations. This is all the more true as August is the start of a traditionally weak phase on the stock market. Added to this are the peculiarities of the holiday season. The experts at HRK Lunis point to “selling rooms being thinly staffed due to the holidays”. Negative impulses on the markets could therefore have a greater impact than usual.
With the reporting season drawing to a close, attention is now turning to the upcoming economic data. “Investors will examine US economic data such as the Empire State Index, the Philadelphia Fed Index and initial unemployment claims for any signs of a recession,” say economists at Landesbank Hessen-Thüringen (Helaba).
Limited scope for interest rate cuts
Inflation is also of interest. Inflation is still above the US Federal Reserve’s target of two percent, which limits the scope for interest rate cuts. The publication of producer and consumer prices for July on Tuesday and Wednesday respectively are therefore likely to attract increased attention.
Positive signals from figures from Germany are unlikely. The ZEW index for August on Tuesday is likely to merely confirm the cautious impression of other data. “After the Sentix index has fallen noticeably, this leading indicator is also likely to decline again,” predict the economists at Helaba.
And political tensions in the Middle East continue to weigh on the markets. Concerns remain about retaliatory strikes against Israel for the killing of two leading figures of Hamas and the Lebanese Hezbollah militia.
