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DAX 40, German Stock Market Corrects Upwards

1/9/2023 12:26 PM

The leading index of the Frankfurt Stock Exchange DAX 40 corrects upwards, trading at around 14700.0.

The German stock market continues to rise despite a negative report from the country's Ministry of Economy, according to which the volume of Factory Orders in November 2022 decreased by 5.3% after rising by 0.6% a month earlier, and the volume of Retail Sales declined by 5.9%, while analysts assumed -2.8%.

Quotes of the index were also supported by the report of the Eurostat, which reflected the slowdown in the dynamics of consumer prices in the eurozone to 9.2% from 10.1% a month earlier. Decreasing inflation at a faster pace could be a signal for the European Central Bank (ECB) to start easing monetary policy, which is of key importance for stock market companies. There is no talk of a complete rejection of the "hawkish" course yet; however, the slowdown in the rate of increase in the interest rate can serve as a driver for strengthening the positions of the DAX 40, which is already being facilitated by the dynamics in the domestic bond market: 10-year bonds lost 0.63%, trading with yield of 2.195%, and long-term 20-year ones lost 0.62%, trading at 2.228%.

The growth leaders in the index are Siemens Energy AG (+3.53%), Linde Plc. (+2.47%), Infineon Technologies AG (+2.40%), Zalando SE (+2.40%).

Among the leaders of the decline are Henkel AG (-2.34%), Sartorius AG (-1.76%), Qiagen NV (-0.68%).

On the daily chart, the price continues to trade in an uptrend, having overcome the local high of the previous year at around 14500.0 the day before.

Technical indicators have already reversed and issued a new buy signal: the fast Alligator indicator EMAs crossed the signal line from below, and the histogram of the AO oscillator moved to the buy area, forming ascending bars.

Support levels: 14500.0, 13800.0. | Resistance levels: 14850.0, 15400.0.

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