The Dax index slightly decreased on Thursday. The index was calculated at 20,426 points at the end of the Xetra trading session, a 0.1% increase compared to the previous day’s close. The Dax approached the previous day’s level in the morning and then regained slight gains in the afternoon.
The main topic among investors on Thursday was the ECB’s interest rate cut. “The European Central Bank is on a clear course to cut interest rates by 25 percentage points each, until the deposit rate reaches 2%”, commented Jochen Stanzl, Chief Market Analyst at CMC Markets.
“The economic conditions would have justified a much bigger step, but it was not taken. That’s why the German stock index only ticked up in response, not more” said the analyst. The good news is already reflected in the high price level, so the analyst believes. “Large profit takings were also absent.”
The market is currently pricing in more interest rate cuts than the ECB officially communicates, according to Stanzl. Therefore, the current stock valuations are “loaded with a good portion of fantasy” that can be disappointed at any time. “However, the decision has not yet shattered these optimistic expectations” the analyst said. “It has rather given investors a green light for the Christmas rally to continue.”
Until just before the end of trading, the shares of Airbus and BMW were at the top of the list in Frankfurt. The bottom of the list was formed by the Siemens Energy shares.
Meanwhile, the gas price fell: a megawatt hour of gas for delivery in January 2025 cost 43 euros, five percent less than the previous day. This implies a consumer price of at least around nine to eleven cents per kilowatt hour, including additional costs and taxes, if the price level remains so.
The oil price fell significantly: a barrel of Brent North Sea oil cost $72.62 at around 5 pm German time on Thursday, 90 cents or 1.2% less than the close of the previous trading day.
The European common currency was slightly weaker on Thursday: one euro cost $1.0493, and one dollar was worth $0.9530 in euros.