US Jobless Claims and ECB and Fed Speakers in Focus

Eurozone Industrial Production and Trade Disappoint

Eurozone industrial production and trade data fell short of market expectations on Wednesday. Industrial production declined by 1.1%, with the trade surplus widening from €6.7 billion to €10.0 billion. Economists forecast production to fall by 1.0% and a trade surplus of €22.3 billion.

Corporate earnings and sentiment toward the Fed countered the weak numbers.

US Retail Sales and Producer Prices Deliver Support

Later in the session, US retail sales and producer prices supported buyer demand. Better-than-expected US retail sales numbers eased fears of a hard landing. Producer prices fueled bets on the Fed ending its rate hike cycle.

On Wednesday, the Nasdaq Composite Index and S&P 500 rose by 0.07% and 0.16%, with the Dow gaining 0.47%.

The Wednesday Market Movers

Infineon Technologies surged 9.43% as investors responded to better-than-expected earnings and a positive outlook for 2024. Siemens Energy AG jumped 8.88% on news of securing a credit line and German government guarantees.

Auto stocks were also among the front-runners. Daimler Truck Holding rallied 2.87%, with BMW (+2.06%), Porsche (+2.23%), and Volkswagen (+2.04%) close behind. Mercedes Benz Group ended the day up 1.31%.

ECB President Christine Lagarde in Focus

On Thursday, ECB President Christine Lagarde will be in the spotlight. After the recent economic indicators, comments relating to the economic outlook and interest rates need consideration. Less hawkish forward guidance on the ECB rate path could support buyer demand.

ECB Executive Board members Andrea Enria and Luis de Guindos are also on the calendar to speak.

US Jobless Claims, Manufacturing, and Fed Speakers in the Spotlight

Later in the Thursday session, the US labor market and manufacturing sector will be in focus. An upward trend in initial jobless claims would support bets on the Fed ending its rate hike cycle. Economists forecast initial jobless claims to increase from 217k to 220k in the week ending November 11.

However, investors must consider the Philly Fed Manufacturing Index and industrial production figures. Early signs of cracks in the US economy could test market bets on a soft landing.

Beyond the numbers, Fed speakers could prove pivotal to the Thursday session. Fed Vice Chair John Williams and FOMC members Michael Barr, Lisa Cook, Loretta Mester, and Christopher Waller are on the calendar to speak.

Reaction to recent inflation and retail sales figures will need consideration. Support for further rate hikes could impact buyer demand for DAX-listed stocks.

The futures markets point to a negative start to the Thursday session. The DAX and the Nasdaq mini were down 39 and 45 points, respectively.

Short-Term Forecast

Macroeconomic indicators and central bank speeches will likely dictate near-term trends. Hawkish ECB and Fed commentary could curtail the current move toward 16,000.

DAX Technical Indicators

Daily Chart

The DAX remained above the 50-day and 200-day EMAs, affirming bullish price signals.

A DAX move through 15,800 would give the bulls a run at the 16,004 resistance level.

Central bank commentary and US economic indicators will be the focal points. Hawkish Fed chatter and better-than-expected US stats could pressure the DAX.

A break below the 15,694 support level would bring 15,500 and the 15,477 support level into play.

The 14-day RSI reading of 68.57 suggests a DAX move to 15,800 before entering overbought territory.