Fed Delivers Rate Coup: DAX Cheers After Hours – Assault on Weekly High
The Federal Reserve delivered what the market expected: a cut in the US key interest rate by 25 basis points. Although the DAX was initially slightly down at the close on Wednesday at 24,130 points (-0.13 percent), the relief from the US stock markets spilled over to the DAX after hours. Consequently, the market is likely to open with a positive gap today, Thursday, massively boosting sentiment ahead of the weekend.
Caution Despite Cheers: Only One US Rate Cut Projected for 2026
Despite the initial relief, the picture remains nuanced. The decision by the Federal Open Market Committee was not unanimous (three dissenting votes), and the monetary policy outlook suggests only one rate cut is likely in 2026. This could sober investors upon closer inspection of the "Dot Plot." Furthermore, the US gross domestic product was revised slightly upwards. It remains to be seen how the market will ultimately interpret the decision, its rationale, and, above all, the monetary policy outlook. For the time being, however, the positive underlying sentiment in the stock markets is expected to persist.
Fresenius and Real Estate Stocks Lead the Gainers
Among individual stocks, strength was evident in diverse sectors yesterday. Fresenius stock closed 2.3 percent higher, securing the day's victory. It was followed by Beiersdorf shares with a price increase of 1.8 percent, and Vonovia stock came in third, gaining 1 percentage point. The strength of Vonovia suggests that hopes for a stabilization of the real estate market and falling interest rates are making housing stocks more attractive again.
DAX Friendly, but Upward Momentum Subdued – Goal is Weekly Close Above 24,000
Technically, it must be noted that the DAX now looks quite friendly. However, the upward momentum is still more subdued than the bulls would like. Due to the after-hours boost following the Fed's decision, the DAX should be well-positioned to close the trading week clearly above the 24,000-point mark on Friday. This would lay the foundation for the continuation of the year-end rally. Investors are now focused on the interpretation of the Fed minutes.
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