DAX in a Low Mood Ahead of ECB Interest Rate Decision

The stock market traffic lights in Frankfurt continue to show yellow: The DAX is increasingly moving sideways and reaches a slight decrease of 0.2 percent at 17,677 points just before the start of trading on Thursday. The leading German index thus remains below the recent record high which it marked on Friday at over 17,800 points after racing from record to record for a week. The apparent calm before the storm could be the result of the tension preceding the key interest rate decision by the European Central Bank (ECB). "It's ECB day again," states Thomas Altmann of the asset management company QC Partners. Although it is deemed unlikely that the ECB will modify the key interest rate, the meeting is eagerly awaited – especially the forecasts for inflation and growth could provide insight into whether the interest rate cut for June, priced in by the markets, reflects a realistic expectation of the ECB. The phrasings by ECB President Christine Lagarde will also be directional. After drastic increases in the key interest rate last year to counteract inflation, there is currently a standstill. Market participants, however, wonder when to expect a counter-adjustment to interest rates. A similar restraint was signaled by the chief of the US Federal Reserve, Jerome Powell, for American interest rate policy, which helped the US stock market to moderate gains. The market will also focus on Encavis, particularly after the recent surge in price of 18 percent. The wind and solar park operator confirms talks with the investor KKR regarding a takeover, albeit at an early stage. This resulted in a slight depreciation of the stock on Tradegate. Quarterly results and future statements continue to shape the stock market, as with Continental. The automotive supplier plans a higher profit margin than previously assumed by the market. Merck wants to return to growth after a dry spell. Brenntag blows cautious notes and predicts, in the worst case, a decline in operational results, which led to noticeable premarket stock losses. In the MDAX, Lufthansa, Gea, and Hugo Boss are in the spotlight due to their outlooks. Lufthansa benefits from the desire to travel and higher ticket prices, while Hugo Boss expects slower growth into the next year. Gea, on the other hand, is pleased with a successful fiscal year and would like to reward its shareholders with a higher dividend. Finally, in the SDAX, various companies such as ProSiebenSat.1, Grenke, GFT, Drägerwerk, and Deutsche Pfandbriefbank deserve attention because of their financial results and economic forecasts.