For investors on both sides of the Atlantic, a turbulent week could be coming to an end. In addition to new inflation data for the Old World, it was in particular statements by various US central bankers that drove the stock markets. On the last day of the trading week, the focus is likely to be on the US labor market data and thus on US monetary policy.
At 18,113 points on Friday, the DAX is even threatened with a slide back to the psychological mark of 18,000 points. The Dow Jones Industrial Average Index (-1.4 percent to 38,596 points), the Nasdaq tech exchange (-1.4 percent to 16,467 points) and the S&P 500 (-1.3 percent to 5,147 points) had fallen significantly on Thursday evening.
DAX 40 Chart on a weekly basis
US data better than expected - German and EU inflation continue to fall
The stock market gates on Wall Street had already reopened on Easter Monday. At 50.3 points, the ISM data for the manufacturing industry in March was above the expansion threshold of 50 points, providing a temporary silver lining.
Job openings in the USA (JOLTs) were also better than expected in the first half of the week, which not least pointed to the strength of the US economy.
According to initial estimates, the March inflation rate for the Federal Republic of Germany rose by 2.2% compared to the same month of the previous year, which was as high as expected and therefore significantly lower than the previous month's figure (2.5%).
The statistics office Eurostat signaled a core inflation rate of 2.9% in Europe after 3.1% in February (compared to the same month last year), which should keep the European Central Bank's (ECB) interest rate cut fantasies alive. Investors continue to expect a cut in June.
ADP data signal strong US labor market report (non-farm payrolls) - Fed central banker fuels interest rate fears
An initial appetizer for the official US labour market report was provided by the ADP data, which at 184,000 jobs was significantly better than expected (148,000).
The ISM index for the service sector had signaled a slowdown compared to the up-and-coming manufacturing sector.
Fed Chairman Jerome Powell reiterated late on Wednesday evening that the US central bank would aim to cut interest rates, but would make this dependent on future economic data. Accordingly, the Fed will continue to move cautiously towards a turnaround in interest rates.
Thursday was a tough day, however, after cautious statements from Fed representatives regarding interest rate cuts made the rounds. Federal Reserve Chairman Neel Kashkari raised the possibility that the Fed might not lower interest rates at all this year. This would be the case if progress in lowering inflation were to stall, it was said.
US labor market data should provide important impetus in the afternoon - focus on inflation in the United States next week
The Non-Farm Payrolls (NFPs) are likely to provide important impetus in the afternoon (14:30). If the jobs report with 200,000 newly created jobs weakens as expected, this could possibly ease monetary policy concerns. It remains to be seen whether this will halt the slide that started yesterday.
In view of the ambitious share price levels, investors could possibly sell off some of their profits.
The publication of new US inflation data in the coming week is also likely to cast its shadow before long. The question marks over the future shape of US monetary policy could become bigger again.
