Fed Anticipation in Frankfurt

EZB dominiert die neue Börsenwoche

 

19.03.2019 – Daily report. The DAX started Tuesday with a stable plus of more than half a percent to a new annual high. Despite a new, bizarre turn in the Brexit chaos. Notwithstanding a rather weak news situation. All eyes in global trading are on the Federal Reserve. And the unanimous opinion is that it will not raise interest rates tomorrow. Let’s wait and see whether the advance praise will be justified.

DAX Reaches New Annual High

A broker rarely sees his trading platform so calmly when a new summit is climbed: The DAX climbed to 11,737 points. It was just last Friday when the German benchmark index climbed to its annual high of 11,725 points. At the bottom of the DAX, the Deutsche Bank share held its own, with many investors first taking profits. The bank is considering a merger with Commerzbank.

5G Auction

The auction of 5G mobile radio frequencies has started in Mainz, Germany, and will be interesting for the shares of the telecommunications industry. 5G is regarded as the next technical revolution in the Internet age, because the transmission rate is about 100 times faster than LTE. This reduces latency times to zero, which means that there are hardly any delays in the transmission of images and voice. Which in turn is the prerequisite for what some experts believe to be the telephony of the future: Holographic images that are transmitted at the same time as the sound via telephone glasses in front of the eyes. Such technology already exists in the military for pilot helmets.

Asia Inconspicuous

Asia did not provide a boost for the German stock market. The Nikkei was largely unagitated: the leading Japanese index of 225 stocks lost barely noticeable 0.1 percent to 21,566 points. In China, the CSI 300 fell by around 0.5 percent on Tuesday. The index contains the 300 most important shares of the Chinese mainland – i.e. not the independent province of Taiwan, which Beijing regards as a renegade province.

US Equities in Positive Territory

Wall Street made some gains on Monday: The Dow Jones Index closed the day up 0.3 percent to 25,914 points. The S&P rose by 0.4 percent to 2,833 points. And the Nasdaq Composite gained 0.3 percent to 7,714 points. By the way, oil prices were particularly strong yesterday. At this point, we reported to you on the Russian shoulder-to-shoulder agreement with OPEC in terms of production cuts.

Everyone is Waiting for the Fed

The Fed had been the big topic in New York. In the USA, the two-day meeting of the Fed’s Open Market Committee will begin today, and news about the interest rate decision will arrive tomorrow. So far, the monetary authorities had announced three further hikes in the key interest rate until the end of 2020. Due to the weaker economy, analysts expect only one to two rate hikes. In December, the Fed raised the key rate to between 2.25 and 2.5 percent. Investors are paying particular attention to indications as to how far the Fed could even loosen its course in order to support the economy. The US order intake for January at 3 p.m. German time today provides an indication of this. The forecast amounts to -0.5 per cent.

Chaotic Days in London

Meanwhile, a new Brexit vote is probably off the table for the time being: President John Bercow only wants to allow a vote if the substance of the motion has been changed. He referred to an old law from the 17th century. But the vote actually planned for today should once again include the proposal to approve the withdrawal treaty with the EU, which has already been rejected twice. This will keep the tension on the british pound.
Please keep an eye on your news ticker – the situation is changing extremely fast.

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