DAX shows a little fighting spirit

A brief dip below the 9000 level and the 400-point fall from the start of December has given the DAX reason to bounce. 

After the index dropped more than 400 points over the course of December, DAX traders have finally decided that enough is enough. The bounce on the day is even more impressive when you consider we are only a few days away from the US Federal Reserve’s latest voting decision on its current debt purchasing scheme. Opinion is still mixed as to what, if anything, will be done, but the latest Bloomberg poll has 35% of institutional analysts calling for a December cut. This morning has also seen Goldman Sachs come out with three reasons why the Fed should wait until 2014 before starting to taper.

More directly affecting the German index have been this morning’s economic release, with the manufacturing purchasing managers index (PMI) increasing from 52.7 to 54.2, and the services PMI drifting from 55.7 down to 54. The above-50 growth levels are a good deal better than the contracting French markets.

This morning has seen the DAX rise by 1% and break through the fifty-day moving average, and now has its sights set on the two hundred-hour moving average at the 9112 level.  

Germany 30 chart

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material 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 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. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money. Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.