A temporary sell-off on the Nasdaq technology exchange has increasingly driven investors in both Germany and the USA this week. The ongoing reporting season thus continues to act as an influencing factor that should not be underestimated. While the US election campaign has receded somewhat into the background, monetary policy developments are now likely to attract more attention. The US Federal Reserve (Fed) meeting is already on the agenda next Wednesday.
DAX Chart
Source: Tradingview
Biggest daily loss in two years - weak figures from Alphabet and Tesla weigh on the market
Following disappointing results from US stock market heavyweights Alphabet and Tesla, the Nasdaq fell to its lowest level since June in the middle of the week, which was also the biggest daily loss in two years (3.65%). Doubts about the sustainability of the recent tech rally are likely to have fueled uncertainty.
The economic data calendar only became exciting towards the middle of the week.
At -18.4 points, GfK consumer confidence for August was surprisingly better than previously expected (-21 points), following -21.6 points in the previous month.
Meanwhile, the purchasing managers from HCOB were all disappointing.
In the USA, however, the S&P Global counterpart in the services sector made surprising gains.
On balance, however, the economic outlook remains gloomy.
Ifo index worse than expected - US GDP growth surprisingly strong
Meanwhile, the widely observed ifo business climate index signaled a further deterioration in business sentiment in Germany. In July, the index fell to 87 points, down from 88.6 points in June. "The German economy is stuck in crisis," the institute said. Around 9,000 companies are surveyed every month.
Better than expected US economic growth may have prevented further losses on Thursday. At 2.8 percent, the US economy grew more strongly in the second quarter than expected (2.0 percent).
However, orders for durable goods fell strangely sharply (-6.6%). Economists had expected an increase of 0.3 percent.
Focus on US price data - reporting season likely to provide further impetus
This Friday, investors will be looking at significant US price data. The PCE price index (core rate) signals an increase of 2.5% for the month of June, after 2.6% in May (year-on-year comparison). A decline could possibly play into the hands of interest rate cut fantasies. Next Wednesday, the Fed will decide on the future key interest rate level.
The trading week will also be rounded off by new Michigan consumer sentiment data (16:00).
The figures from BASF and Mercedes-Benz are worth keeping an eye on in Germany. The chemical group BASF had to contend with a significantly weaker agricultural chemicals business in the past quarter. Meanwhile, car manufacturer Mercedes-Benz is facing delivery problems and a difficult market environment in China.
