From Adidas to Zalando: Discover all the latest news on DAX companies, traditional German firms, and global market trends here.

++DAX Attempts Recovery at the Start of the Week++ (June 17, 2024) After correcting back to 18,000 points, the DAX appears to be attempting a recovery on Monday. IG broker estimated the German benchmark index to be up 0.3 percent at 18,062 points about two hours before the start of Xetra trading. On Friday, the DAX had briefly fallen to 17,951 points, nearing its 100-day moving average and losing nearly 3.7 percent over two days.

This confirmed the clear break of its upward trend that had been in place since October 2023. Bargain hunters are now encouraged mainly by gains in U.S. technology stocks after European trading hours. The Nasdaq 100 index even managed to continue its record rally.

Shift in Investment Portfolio Favorites In Europe, the situation is somewhat different according to JPMorgan. The U.S. banking giant’s market strategists believe the shift towards defensive stocks that began in the second quarter will continue into the second half of the year.

Highly valued cyclical stocks such as automotive, chemicals, tourism, and construction sectors face challenges, says expert Mislav Matejka. The strength of the healthcare sector is now broader and no longer solely driven by Novo Nordisk’s rally. Matejka is also skeptical about banks, expecting them to extend their correction from the 2015 highs.

++Federal Reserve Maintains High Interest Rates++ (June 13, 2024) The U.S. Federal Reserve (Fed) continues its high-interest-rate policy, only hinting at one rate cut this year. The Fed left the key interest rate unchanged in the range of 5.25 to 5.5 percent for the seventh consecutive time, the Board of Governors announced on Wednesday in Washington.

This rate is what commercial banks pay to borrow money from the central bank, keeping it at the highest level in over two decades. New Fed data also indicates that inflation may prove more persistent than expected.

ECB Lowers Interest Rate, Fed Hesitates Last week, the European Central Bank (ECB) initiated a rate cut, lowering the key rate by 0.25 percentage points. The Fed might take more time to make a similar move. Fed Chair Jerome Powell indicated it could take longer for the Fed to gain the confidence needed to start easing monetary policy.

The Fed’s new economic forecast still suggests that the central bank might cut rates once more this year – a revision from the previous expectation of three rate cuts of 0.25 percentage points each. Now, Fed policymakers anticipate an average key rate of 5.1 percent for this year (up from 4.6 percent in March), equivalent to a 0.25 percentage point cut.

DAX Response On Thursday, the DAX is expected to open with losses, according to futures market indications. On Wednesday, it closed 1.4 percent higher at 18,630.86 points. The surprise decline in U.S. inflation had lifted the stock market mood. However, following the Fed’s interest rate decision, U.S. markets closed mixed.

While the technology sector in the U.S., driven by AI enthusiasm among major tech giants, saw significant gains, the DAX couldn’t keep up with the U.S. tech stocks, wrote market observer Thomas Altmann of QC Partners in the morning.

In addition to the lower proportion of technology stocks, uncertainty ahead of the new elections in France continues to weigh on Eurozone markets. Brief breaks out of the DAX’s month-long sideways range have recently tended to be downward.