Jump to content

DAX 40 Hit by Nasdaq 100 Slump, German IFO Warns of Growing Pessimism

Recommended Posts


  • Nasdaq 100 falls 2.5% overnight, opens lower in Europe.
  • DAX 40 in the red with the latest IFO assessment adding to economic pessimism.
DAX Expands To 40 Members. Which Are The New Companies? | Eightcap

The DAX 40 is trading the best part of 1% lower in early European trade, hampered by heavy losses in the NASDAQ 100. The top 10 constituents of the NASDAQ 100, by market weighting, all registered hefty losses last night, sending the index down by nearly 2.5%. The tech index is currently down another 0.75% in Europe.

DAX 40 Hit by Nasdaq 100 Slump, German IFO Warns of Growing Pessimism

While the Nasdaq chart remains positive for now on a longer time frame, with a multi-month set of higher highs and higher lows in place, a break below the 15,500 area of prior support may see short-term losses deepen as we head into the end of the year. Traders should also be aware that today is a quarterly ‘quadruple witching’ Friday when stock index futures, stock index options, stock options, and single stock futures expire simultaneously. This is likely to lead to volatile swings today.


DAX 40 Hit by Nasdaq 100 Slump, German IFO Warns of Growing Pessimism

The latest German IFO release (December) warns that ‘the deteriorating pandemic situation is hitting consumer-related service providers and retailers hard’. The IFO business climate index fell to 94.7 from 96.6 in November as ‘companies assess their current business situation as less positive’ while pessimism regarding the first half of 2022 also increased. The IFO Institute ended, ‘the German economy isn’t getting any presents this year’.

DAX 40 Hit by Nasdaq 100 Slump, German IFO Warns of Growing Pessimism

Both the Nasdaq sell-off and the pessimistic IFO release are weighing on the DAX 40 with the German bourse down 0.80% this morning. The Dax is being led lower by the 20-day simple moving average and now trades below both the 50- and 200-day smas, adding to the negative outlook.


DAX 40 Hit by Nasdaq 100 Slump, German IFO Warns of Growing Pessimism

How to Short Sell a Stock When Trading Falling Markets

What is your view on Equities – bullish or bearish?


By Nick Cawley, Strategist, 17th December 2021. DailyFX

Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • Posts

    • Sainsburys full year earnings and Unilever’s first quarter trading update both say the same thing, UK consumers are in for higher prices. The war in Ukraine, supply chain issues and the effects of ongoing Covid all to blame.      
    • US Dollar (DXY) Daily Price and Analysis US Q1 GDP may stall the greenback’s advance. A 20-year high nears for the US dollar. The multi-month US dollar rally continues with the greenback printing a fresh high today ahead of the first look at US Q1 GDP at 12.30 GMT. The US dollar basket (DXY) has been boosted by renewed weakness in the Euro and the Japanese Yen, as investors move from lower-yielding to higher-yielding currencies, while safe-haven flows continue to benefit the greenback. The US growth release later in the session is expected to show a sharp slowdown from the robust Q4 figure of 6.9%. The markets are currently pricing in growth of just 1% for the first three months of this year, with the slowdown mainly due to a reduction in inventory accrual over the quarter. This release is unlikely to move the greenback, unless there is a large miss or beat, as the Fed believe that 2022 US growth will be robust enough to let them tighten monetary policy sharply without damaging the economy. The latest US Core PCE data – the Fed’s preferred inflation reading – is released on Friday and this may have more effect on the US dollar than today’s GDP data. For all market moving economic data and events, see the DailyFX Calendar. The ongoing US dollar rally has been aided by weakness across a range of G7 currencies including the Euro, the Japanese Yen, and the British Pound. The Euro continues to battle with lowly growth expectations, exacerbated by energy concerns, the British Pound is mired by weak economic data, while the Japanese Yen is in freefall as the BoJ continues with its ultra-loose monetary policy.   The US dollar continues to press higher and looks set to break above 103.96, the March 2020 high. Above here the US dollar would be back at levels last seen nearly two decades ago. The March resistance will likely hold in the short-term, especially with month-end portfolio rebalancing at the end of the week, but US dollar strength is set to continue in the months ahead. USDOLLAR (DXY) WEEKLY PRICE CHART – APRIL 28, 2022 {{THE_FUNDAMENTALS_OF_BREAKOUT_TRADING}} What is your view on the US Dollar – bullish or bearish?   Apr 28, 2022 | DailyFX Nick Cawley, Strategist
    • While Tesla has nothing directly to do with Elon Musk buying Twitter - TSLA stock closed down 12% on news that Musk may have to sell stock and use other holdings to stand against the loan to finalise the purchase of the social media giant.        
  • Create New...