Weekly outlook: US elections and inflation put Dax recovery to the test

In the new week, the midterm elections in the US could prove to be an additional burden on the recovery of the Dax.

Weekly outlook: US elections and inflation put Dax recovery to the test

In the new week, the midterm elections in the US could prove to be an additional burden on the recovery of the Dax. The leading German index briefly climbed above the 13,500 point mark on Friday afternoon, reaching its highest level since mid-September.

In the end, the stock market barometer gained 2.51 percent to 13,459.85 points after two weak trading days. On a weekly basis, this means an increase of 1.63 percent. The MDax of medium-sized stocks rose by 2.43 percent to 23,811.57 points on Friday.

After US Federal Reserve Chairman Jerome Powell recently caused uncertainty with the statement that there was no end in sight to interest rate hikes, "the result of the US congressional elections could keep the capital markets moving," wrote analyst Claudia Windt from Landesbank Hessen-Thüringen (Helaba).

The Central Banks' Struggle Against Inflation

Investors are also likely to keep an eye on the United Nations World Climate Change Conference in the Egyptian seaside resort of Sharm El Sheikh, which begins on Sunday. There, almost 200 countries will discuss for two weeks how the fight against global warming can be accelerated. Dozens of heads of state and government are expected on Monday and Tuesday to address the climate conference in brief statements. Their statements could move the shares of providers of alternative energies.

The struggle of the central banks against the high inflation also remains in view. On Thursday, the question will be answered as to whether inflation in the USA actually fell further in October, as analysts had expected. If not, speculation about tougher action by monetary authorities could flare up again.

Andreas Weiß, Head of Shares at the Munich asset management company Huber, Reuss and Colleagues, is more confident. The most recent setback on the stock exchange according to statements by Fed boss Jerome Powell could be the starting point for a pleasing price development in the new week. The major negative factors for the current stock year should now be largely priced in, provided the unexpected does not happen. In addition, the company forecasts for the full year 2022 appeared to be easily achievable, regardless of the development in the last two months of the calendar year.

Bayer and Henkel give figures

Analyst Markus Wallner from Commerzbank was somewhat more skeptical: "The reports already available for the third quarter sometimes show large differences in the quality of the results of German companies."

In the new week, a whole series of companies from the lower stock market leagues will report on their performance in the past quarter. In addition, some companies from the leading index Dax with their balance sheets are in focus. Then it will be seen whether the fresh business figures are more likely to put people in a good mood or cause misery on the stock market.

The agrochemical and pharmaceutical group Bayer and the consumer goods manufacturer Henkel will present their figures on Tuesday. The medical technology manufacturer Siemens Healthineers and the energy company Eon will follow in the middle of the week. On Thursday, attention will focus in particular on Deutsche Telekom, the insurer Allianz, the energy group RWE and the pharmaceutical and specialty chemicals group Merck KGaA.

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