The Dax index started the trading day on Thursday morning with slight gains. By 9:30 am, the leading index was calculated at around 20,425 points, 0.1 percent above the previous day’s closing level. At the top of the price list were Rheinmetall, Adidas, and BASF, followed by Deutsche Post, Munich Re, and Siemens Energy.
The main topic of the day is the European Central Bank’s interest rate decision in the afternoon. Most observers expect the central bank to announce another rate cut. “It’s a done deal that the ECB will turn the interest rate screw again and lower its key interest rates by 0.25 percent today” said Thomas Altmann of QC Partners. This would mean that the particularly closely watched ECB deposit rate would then be at 3.0 percent.
“For the stock markets, the interest rate outlook and the updated growth and inflation forecasts will be more important than the interest rate decision itself” Altmann said. It is currently being priced in that the ECB will carry out several cuts of 25 basis points each in the coming year. “Christine Lagarde will certainly remain vague and once again emphasize the data dependence of future interest rate decisions.” However, the new forecasts from the ECB could provide deeper insights here.
The European common currency was a bit stronger on Thursday morning: one euro cost 1.0510 US dollars, and one US dollar was worth 0.9515 euros.
Meanwhile, the oil price rose: a barrel of the Brent North Sea variety cost around $73.84 by 9 am German time, which was 32 cents or 0.4 percent more than at the end of the previous trading day.