Weekly outlook: New record within reach

After the recent steep rise, the new week is off to a more subdued start. However, the DAX all-time high is not far away - and neither is the 20,000 point mark. Confidence prevails.

2 December 2024 FRANKFURT (Frankfurt Stock Exchange). The stock markets remain in a celebratory mood. After the new record highs on Wall Street on Friday, the DAX could also soon reach new highs and exceed the 20,000-point mark, analysts believe. The mood on Monday morning will be supported by new economic data from China, as Deutsche Bank explains. The Caixin Purchasing Managers' Index for the manufacturing sector has risen to its highest level since June.

The DAX stood at 19,600 points on Monday morning. On Friday, the index closed at 19,626 points, just below the all-time high of 19,674.70 points reached in mid-October. The Dow Jones and S&P 500 climbed to new highs on Black Friday, while the Nasdaq 100 remained slightly below its most recent record high. Bitcoin has not yet made the leap over the 100,000 US dollar mark; on Monday morning, the most important cryptocurrency costs 96,411 US dollars.

“Still moderate valuation”

“In an environment that is not easy overall, the still moderate valuation speaks in favor of the DAX,” explains Markus Reinwand from Helaba. Despite the continued price increase, the DAX is still comfortably within its fair valuation range, currently between 15,800 and 21,100 points. Further falls in key interest rates are opening up additional scope for valuation. Improving global growth and earnings prospects also argue for further price rises. “However, after two years of above-average share performance, 'only' average growth can be expected for 2025,” explains the analyst.

“US equities in pole position”

Robert Halver from Baader Bank is also already looking ahead to 2025: due to the leading earnings expectations in the USA in an international comparison, he sees US equities fundamentally in the “pole position”. In principle, a robust US economy and a gradual stabilization of the global economy also argue for a positive equity outlook for European and German export stocks, especially small and mid-caps. In Europe, the focus is on cyclical sectors with intact business models, stable cash flows and, in many cases, valuations that are still very low, as low as they were in 2012. “Companies from the industrial and banking sectors in particular have a value character,” explains Halver.

”20,000 points only a matter of time”

Things also look good from a technical perspective: “The completion of the SKS formation (shoulder-head-shoulder) was prevented. With the jump over the right shoulder of the reversal formation, the technical situation has improved at a stroke,” explains Christian Henke from IG. Now the DAX could head for its previous all-time high.

According to Christoph Geyer, the DAX was recently able to impressively prevent a further drift. Instead, there was a dynamic upward movement at the end of the week. “The current corrective movement may have come to an end with the surge on Friday,” explains Geyer. A similar movement at the start of the week would probably mean a new record high. “This would resume the previous upward trend. Reaching the 20,000 mark by the end of the year would therefore only be a matter of time.”

Important economic and business events of the week

Monday, 2 December

16.00. USA: ISM Manufacturing Index November. According to Helaba, the regional Fed sentiment surveys are positive on balance. Thus, a recovery is emerging.

Thursday, 5 December

8.00 am. Germany: Industrial orders in October. Commerzbank fears a weak start to the fall for German industry due to the recent weak sentiment indicators. It expects a significant drop of 3.5 percent.

11.00 am. Eurozone: Retail sales October. A month-on-month decline from plus 0.5 to minus 0.3 percent is forecast, according to Deutsche Bank, and a year-on-year decline from 2.9 to 1.9 percent.

Friday, 6 December

Trading Charity Initiative of Börse Frankfurt. For every order executed via the Frankfurt trading venue on this day, Deutsche Börse and the specialists will donate the fees to the Frankfurt Foundation for Children with Cancer, the Living with Cancer Foundation and the “Back to Life” soccer group. More information: www.boerse-frankfurt.de/charity

8.00 am. Germany: Industrial production October. The previous months were characterized by volatile car production, according to DekaBank. This situation normalized in October, with a moderate increase.

14.30. USA: Unemployment figures for November. According to Commerzbank, a relatively large number of new jobs were created in the USA in November. However, special factors were responsible for this, specifically the hurricanes and several strikes in October.

By Anna-Maria Borse, 2 December 2024, © Deutsche Börse AG