Dax Index News: Wholesale Prices and ECB Outlook Influence DAX Trends Today

Market Overview

On Wednesday, September 11, the DAX advanced by 0.35%, partially recovering from a 0.96% loss in the previous day to close at 18,330.

Key DAX Market Movers

Commerzbank surged by 16.59% on news of UniCredit buying a 9% stake amid speculation of a possible takeover attempt.

Auto stocks also contributed to the DAX’s gains as they recovered losses from Tuesday, with BMW rallying 3.04%.

Tech stocks also advanced, with Infineon Technologies and SAP seeing gains of 1.26% and 0.98%, respectively, over hopes for ECB and Fed rate cuts.

German Wholesale Prices in Focus

On Thursday, September 12, wholesale price data from Germany will draw investor attention. Economists expect wholesale prices to increase by 0.1% in August after rising by 0.3% in July.

Softer-than-expected wholesale prices could indicate weakening demand, supporting a more dovish ECB rate path. Lower borrowing costs could boost company profits and increase demand for DAX-listed stocks.

The ECB Interest Rate Decision and Press Conference

Later in the Thursday session, the ECB interest rate decision and press conference will be crucial for the market sentiment. Investors expect a 25 basis points cut to 4%. A 25 basis point rate cut will likely shift the focus to the press conference. Hints of more interest rate cuts in Q4 2024 could drive buyer demand for DAX-listed stocks.

Expert Views on the ECB Rate Path

Hamburg Bank Chief Economist Cyrus de la Rubia stated on Squawk Box Europe that while he expected a September rate cut, no more cuts are likely in 2024.

US CPI Report Impacts Fed Rate Path

On Wednesday, the US CPI Report sank investor bets on a 50-basis point September Fed rate cut. While headline inflation softened to 2.5% in August, the core inflation rate remained steady at 3.2%, well above the Fed’s 2% target.

According to the CME FedWatch Tool, the probability of a 50-basis point September rate cut fell from 34% on Tuesday, September 10, to 15% on Wednesday, September 11.

Expert Views on US Inflation and the Fed Rate Path

Arch Capital Global Chief Economist Parker Ross commented on the US CPI Report, saying,

“While nothing in this report is concerning or suggestive of a durable rebound in inflation, it effectively closes the door on any hopes of a 50bps rate cut next week.”

US Market Trends

On Wednesday, September 11, the US equity markets ended the day with solid gains. The Dow and the S&P 500 advanced by 0.31% and 1.07%, respectively, while the Nasdaq Composite Index rallied by 2.17%.

NVIDIA surged by 8.15% as investors reacted to reports that the US government may allow the company to export chips to Saudi Arabia.

US Economic Calendar

On Thursday, September 12, initial jobless claims and producer prices may influence sentiment toward the Fed rate path.

US Jobless Claims and the Fed Rate Path

Economists forecast initial jobless claims to increase from 227k in the week ending August 31 to 230k in the week ending September 7. Higher-than-expected claims may boost investor bets on a 50-basis point September Fed rate cut. Weaker labor market conditions may affect wage growth, possibly curbing consumer spending, which accounts for over 60% of US GDP.

US Producer Prices in Focus

Additionally, economists expect producer prices to increase by 1.8% year-on-year in August, down from 2.2% in July. Softer figures could signal weakening demand, possibly dampening demand-driven inflation pressures. A softer inflation outlook could raise expectations of a 50-basis point September Fed rate cut.

Notably, a more dovish Fed rate path could lower borrowing costs, possibly boosting earnings and stock prices.

Near-Term Outlook

Near-term DAX trends will likely hinge on the ECB and the US economic calendar. Support for Q4 2024 ECB rate cuts in 2024 could drive buyer demand for DAX-listed stocks. Furthermore, weaker US labor market conditions and producer prices may refuel bets on a 50-basis point Fed rate cut, supporting buyer appetite for riskier assets.

A dovish ECB and favorable US data could push the DAX toward 18,500. Conversely, upbeat numbers from the US or signals of an ECB pause after September could send the DAX down toward 18,000.

In the futures markets, the DAX and the Nasdaq mini were up by 183 and 44 points, respectively.

Investors should stay alert to central bank activity and economic indicators likely to influence risk sentiment. Monitor the news wires, the economic calendar, and expert commentary to manage trading strategies.

Stay informed with our latest news and analysis to manage your risks effectively.

DAX Technical Indicators

Daily Chart

The DAX hovered below the 50-day EMA while holding above the 200-day EMA, sending bearish near-term but bullish longer-term price signals.

A break above the 50-day EMA could support a move toward 18,500. Furthermore, a return to 18,500 could give the bulls a run at 18,750.

The ECB and the US economic calendar require consideration.

Conversely, a drop below 18,200 may give the bears a run at the 18,000 level. A fall through 18,000 would bring the 200-day EMA into play.

The 14-day RSI at 46.82 indicates a fall to 18,000 before entering oversold territory.