The DAX is slightly higher in the Monday session. Currently, the DAX is at 11,625, up 0.20% on the day. There are no major German or eurozone events. Sentix Investor Confidence came in at -2.2, marking a fourth successive decline. Eurozone PPI rebounded with a gain of 0.4%, after two straight declines. On Tuesday, Germany and the eurozone will publish services PMIs.
It was another strong week for the DAX, which posted gains of 1.2%. The index reached a high of 11,676 on Friday, its highest level since the end of October. Risk appetite remains strong, as trade talks between China and the U.S. continue to make progress. If the positive momentum continues, President Trump and Chinese President Xi could sign a trade agreement in late March.
Still, it’s unclear what the agreement will look like, as the sides have been very tight-lipped. Investors will be most concerned as to whether U.S. tariffs on Chinese products would be eliminated immediately or phased out over time. If speculation rises that a breakthrough is imminent, the stock markets will likely head higher.
In Germany and the rest of the eurozone, the employment picture remains bright, but manufacturing scores are raising concerns. On the employment front, German unemployment rolls fell by 21 thousand, crushing the estimate of -5 thousand. The eurozone unemployment rate dropped to 7.8% in January, down from 7.9% a month earlier.
The manufacturing industry continues to struggle, as the global trade war has reduced the demand for European exports. German and eurozone manufacturing PMIs in February came in below the 50-mark, which separates contraction from expansion. German consumers opened up the purse strings in January , as retail sales bounced back with a 3.3% gain, after a 4.3% decline in December.
Economic Calendar
Monday (March 4)
- 4:30 Eurozone Sentix Investor Confidence. Estimate -3.1. Actual -2.2
- 5:00 Eurozone PPI. Estimate 0.4%. Actual 0.4%
Tuesday (March 5)
- 3:55 German Final Services PMI. Estimate 55.1
- 4:00 Eurozone Services PMI. Estimate 52.3
- 5:00 Eurozone Retail Sales. Estimate 1.3%
*All release times are DST
*Key events are in bold
DAX, Monday, March 4 at 7:05 EST
Previous Close: 11,601 Open: 11,646 Low: 11,596 High: 11,648 Close: 11,625