Market report: There will probably be no price recovery for the time being

The broker IG Markets estimates the leading German index 0.3 percent lower to 25,737 points before the opening of Xetra trading. Last Friday, the DAX fell by 1.9 percent to 25,820 points. At times he had lost over 1,000 points from the record he had achieved just the day before with 26,692 points. The losses were triggered by investors' fears of stricter AI regulation in the USA.

The 25,800 point mark remains the short-term pivot point, notes IG expert Salah-Eddine Bouhmidi. "A sustainable recapture and subsequent defense would be important steps towards stabilization and would improve the chances of a year-end rally."

Investors are naturally wondering whether the price decline will continue this week. It could remain turbulent, but according to experts there are also opportunities for the German leading index: The fact that the DAX is not particularly technology-heavy makes it an interesting alternative for many investors in the current market phase, states portfolio manager Thomas Altmann from asset manager QC Partners.

Andreas Lipkow, chief market analyst at broker CMC Markets, also sees the European stock markets as still having the opportunity to at least partially decouple themselves from the weakness of the US technology exchanges. The hoped-for end-of-year rally does not have to happen, but it is likely to be more bumpy than expected just a few days ago.

The accounting season is one of the factors that determine the direction this week. From today to Thursday, the reinsurers Hannover Re and Munich Re, the utilities Eon and RWE as well as Siemens and Henkel will be presenting quarterly figures from the DAX. In addition, two German AI beneficiaries, Infineon and Siemens Energy, are also in the spotlight.

In addition to geopolitics and monetary policy, corporate profits remain a key price driver. If the numbers turn out to be stronger than expected, the DAX could benefit from this.

Next Tuesday could provide some indication of how US monetary policy could continue. Then the current October inflation data from the USA will be available. Robert Greil, chief strategist at private bank Merck Finck, expects inflation to reach four percent. “This would mean that the inflation rate on both sides of the Atlantic would be twice as high as the ECB and Fed were aiming for,” wrote Greil.

Both the European Central Bank and the US Federal Reserve are therefore likely to raise their key interest rates again in December. If the US Federal Reserve (Fed) were forced to further increase the key interest rate, loans would become more expensive. Stronger regulation and higher borrowing costs would not bode well, especially for AI companies. But the entire economy is also likely to suffer.

The Asian stock markets have at least stabilized again at the start of the week after the recent turbulence in the technology sector. In Tokyo, the Nikkei index, which includes 225 stocks, gained more than three percent. Investors in China also took action again: the Shanghai stock exchange gained 0.5 percent to 3,665 positions. The index of major companies in Shanghai and Shenzhen rose 0.2 percent to 4,064 points.

Whether this is a reversal of the trend remains questionable: "The markets are far from out of the woods," says analyst Kyle Rodda from broker Capital.com. After the elections, the regulatory risk increased, and large tech companies also disappointed in the reporting season. "The momentum remains downwards."