DAX Today: How China Stimulus Measures Impact Market Dynamics

Market Overview

On Tuesday, September 24, the DAX rallied 0.80%, following a 0.68% gain from the previous session to close at 18,997.

Auto Stocks Propel DAX Rally

Auto stocks were amongst the leaders as investors reacted to stimulus measures from China, expected to boost demand. BMW rallied 3.55%, while Daimler Truck Holding and Volkswagen advanced by 1.76% and 1.62%, respectively.

• Online retailer Zalando SE gained by 2.24%
• Adidas increased by 0.92%

China Policy Measures and Market Sentiment

On September 24, the People’s Bank of China announced policy measures to support the economy. Hopes for demand recovery have elevated market risk sentiment, affecting the European trading session positively.

German Ifo Business Climate Index Falls

Germany’s Ifo Business Climate Index decreased from 86.6 in August to 85.4 in September, marking a decline for the fourth straight month. There is growing concern as firms express increasing pessimism regarding the economic outlook, impacting potential business investment and employment that could lead to a more dovish ECB rate path.

ECB Rate Path Insights

Pictet Wealth Management's Frederik Ducrozet commented on the ECB rate prospects, indicating a possibility for 15bps adjustment in the upcoming meeting.

US Consumer Confidence Falls

The CB Consumer Confidence Index fell from 105.6 to 98.7, raising alarms about labor market stability.

US Market Trends

The US equity markets continued their positive momentum, with the Nasdaq gaining 0.56%.

Near-Term DAX Outlook

The near-term direction for the DAX hinges on ECB commentary and US economic data. With a softer US landing, the DAX could challenge its all-time high.

DAX Technical Indicators

Currently, the DAX remains above the 50-day and 200-day EMAs, indicating bullish signals.