The RoboMarkets Weekly Review and Outlook – DAX Starts Year-end Rally

“Never fight the Fed”

The all-important question, however, is who will ultimately emerge victorious in this rather unequal duel: the market, which does not believe in further interest rate hikes and is already considering interest rate cuts next year, or the central bank, which at least verbally remains true to its restrictive line and wants to prevent an easing of financing conditions for all the world. Investors should therefore not be too euphoric or too quick to take risks. Going against the Fed has usually not been the right strategy in the past.

Siemens With A Dream Finale To The Reporting Season

The German reporting season is over, and with a bang. Siemens was the last DAX company to present its figures and more than convinced investors. On the bottom line, the Group earned 8.5 billion euros in the past financial year, almost twice as much as a year earlier. Shareholders are also set to benefit from this, with an increase in the dividend from 4.25 to 4.70 euros. The dream scenario for investors is rounded off by a further share buyback in total six billion euros over the next five years. A mix of news that not only pushed Siemens shares up by more than five per cent, but also the DAX.

The Chinese are once again flirting with European and German gems. The share price of Mediamarkt and Saturn parent company Ceconomy rose by 25 per cent at its peak this week, but then fell again slightly. According to media reports, China’s online giant JD.com is in talks with the major shareholders. Due to the complex shareholder structure at Ceconomy, the talks could either take a long time or be very quick if everyone is on board.

There is now also plenty of speculation about the amount of a takeover bid that would be required if the 30 per cent threshold is exceeded by the remaining shareholders. This may therefore be an attractive investment opportunity not only in the case of Ceconomy, but also with a view to other takeover candidates should China’s shopping spree in Europe continue.

What Will Happen in the Coming Week?

Not too much on the data front at least, if you take a look at the diary. Purchasing managers’ indices from Germany and the eurozone on Thursday and the ifo index on Friday are the highlights. The publication of the minutes of the last Fed meeting on Wednesday evening could also have been interesting. However, after the consumer and producer price data, which also came in weaker than expected, one could be forgiven for thinking that nothing is as old as yesterday’s newspaper.

DAX – Current Supports and Resistances

Supports: 15,700/15,650 + 15,550/15,500 + 15,400/15,350

Resistances: 15,900/15,950 + 16,000/16,050 + 16,150/16,200

This article is from RoboMarkets.