DAX at the Limit? Record Run Stalls at 25,500 Points
The German leading index currently seems to know no bounds, yet Tuesday evening revealed the first cracks in the bullish facade. Although the DAX reached another fresh all-time high of 25,507 points, there are strong indications that the bulls' strength for this particular surge has been exhausted for now. Immediately after crossing the psychological 25,500-point mark, noticeable profit-taking set in—a classic signal for a much-needed breather.
Kickoff for US Earnings Season: Banks Take the Helm
Today, Wednesday, investor focus shifts heavily toward the United States. Major US banks are traditionally the ones to kick off the Earnings Season, serving as early warning indicators for the global economy. With quarterly reports from Bank of America, Wells Fargo, and Citigroup, the market will see just how robust the global economy truly is. These results are expected to significantly influence sentiment in Frankfurt and could trigger volatility, particularly among local banking stocks.
Economic Pulse Check: Focus on US Consumption and Producer Prices
At 2:30 PM CET, the next wave of data will arrive from overseas. On the agenda are Producer Prices (PPI), which are considered precursors to inflation; rising costs for producers almost always end up affecting consumer wallets. Simultaneously, Retail Sales figures will be released. Since private consumption accounts for roughly 70 percent of US GDP, these numbers are the ultimate barometer for the economic health of the United States.
Technical Analysis: Healthy Correction or Trend Reversal?
Despite yesterday’s top performers—Adidas, Symrise, and Siemens Healthineers—the technical picture urges vigilance. The DAX has run hot. A correction following such a rapid rally is not only expected but would be healthy for the overall stability of the trend.
Investors should not panic: even a pullback of up to 800 points would not jeopardize the primary upward trend. It remains to be seen whether the market "hardens" today or if the New Year's euphoria transitions into a necessary consolidation phase.
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