DAX futures: German index poised to open lower

DailyFx Analyst Justin McQueen warns that ‘recoveries in the index are likely to be shallow as the spread of coronavirus shows little signs of easing up.’

DAX futures suggest market will open lower

In response to the unfolding coronavirus crisis – the European Central Bank (ECB) late yesterday announced a 750 billion ‘Pandemic Emergency Purchase Programme,’ that would centrally involve the purchase of private and public sector securities.

According to the ECB, these emergency measures aim at countering ‘the serious risks to the monetary policy transmission mechanism and the outlook for the euro area posed by the outbreak and escalating diffusion of the coronavirus, COVID-19.’

In response, DAX futures are currently pointing to a sharply lower open for the Germany 30 index, as markets across the globe continue to experience unprecedented levels of volatility, both up and down.

Though DAX futures traded almost 170 points higher a little before midnight, by 4:00 am (GMT+1) futures had turned red, implying that the German market would open around the 8,068 point level – or some 4.59% lower.

This marks another day of implied losses for the DAX, after the Germany 30 benchmark fell 5.56% or 497 points yesterday. Worse still, in the last five days the index has given up close to 1,400 points, finishing out Wednesday’s session at the 8,441 point mark, a level not reached in over five years.

Moreover, and speaking to the depth of coronavirus-led carnage, only three German stocks notched up a positive performance on Wednesday; with the share prices of EON, Henkel vz and Beiersdorf the only stocks registering gains.

All up, the majority of the index suffered steep declines: with the country’s crowning corporate achievement such as Volkswagen falling 11.99%, while Siemens and Daimler dropped 10.01% and 9.32%, respectively.

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Other markets at a glance

Broader afield, volatility continues to wash over UK and US equity markets – with the FTSE, Dow Jones, S&P 500 and NASDAQ all recording heady losses yesterday.

Specifically, the Dow fell 6.3% or 1,338 points; while the UK FTSE recorded slighlty more mild losses of 4.05% or 214 points.

This comes as coronavirus (Covid-19) cases continue to rise rapidly across the globe. At the time of writing, global coronavirus cases stood at 219,217, while deaths from the virus currently stand at 8,965.


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