DAX assisted by soft data

The Germany 30 is higher on the day after weak economic data from the eurozone increased the likelihood of monetary easing.

DAX sign
Source: Bloomberg

The Germany 30 is trading at 9858, up 0.25% after weak manufacturing data and a stubbornly high unemployment rate for the eurozone helped the German equity market edge higher; traders feel this could lead to more monetary easing from the European Central Bank.

The ECB interest rate decision and press conference on Thursday is the focus of the week, and the base rate is unlikely to change but the statement after could give us an idea of the ECB's plans.

Mario Draghi has less wiggle room and he doesn’t want to embark on an aggressive easing programme overnight. I suspect he will keep his outlook unchanged while leaving the door opening to extra easing in the coming months.

As Chris Beauchamp stated, the 50-day moving average of 9831 is providing support, and if the market closes above 9884 it would be as bullish signal; the short-term target is 10,000.

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