Established in 1974
185,800 clients worldwide
Over 15,000 markets

DAX drops after CPI and jobs data

The Germany 30 has shied away from record highs as mixed news from the eurozone leaves traders securing profits.

The Germany 30 is trading at 9903, down 0.5% on the day after a surprise drop in eurozone inflation and unemployment left traders in two minds about the European Central Bank’s meeting on Thursday. Today’s data contradicts itself; lower inflation would suggest Mario Draghi will pursue a monetary easing policy in two days, but then again he may use the decline in the jobless rate as an excuse to keep his policy unchanged.

Mario Draghi has already achieved a weaker euro by suggesting that he may loosen monetary policy, and traders have been buying eurozone equities in anticipation of easing. We have seen some profit-taking this morning as there is no clear indication which way Mr Draghi will move.

As Chris Beauchamp stated, the upward strength is lacking and it feels like the DAX is running out of steam. If we drop below the 200-hour moving average of 9980, the next important level down would be 9800. I suspect we will not see the index flirting with 10,000 before the meeting on Thursday.

The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG Bank S.A. accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication.

Find articles by analysts