Weekly outlook: Chance of 20,000 points?
Is the multi-week correction on the German stock market coming to an end? That is exactly what it looks like at the moment - despite unchanged general conditions. Confidence prevails in the outlook for 2025 anyway.
25 November 2024 FRANKFURT (Frankfurt Stock Exchange). Economic turmoil, tariff fears, the war in Ukraine and the Middle East - all of this suddenly no longer seems to matter. The German stock market had already risen again on Thursday and Friday, and the good mood is continuing in the new week. The DAX stood at 19,458 points on Monday morning, after a volatile week with prices below 19,000 points and a rise to 19,323 at the close of trading on Friday.
Record highs in the USA
After temporary setbacks, the “Trump trade” is being played out again in the USA. The US stock markets closed at record highs on Friday, or only just below them. The extremely strong US dollar is striking, with the euro falling to its lowest level in two years on Friday. The Bitcoin rally is also continuing. The price of the most important cryptocurrency is currently at 98,287 US dollars, just below the 100,000 US dollar mark.
The nomination of hedge fund manager Scott Bessent as the future US Secretary of the Treasury has been well received. Bessent is in favor of tax reform and deregulation, but - especially in comparison to Elon Musk - is said to stand for a moderate course overall.
“Willingness to buy is back”
According to Christoph Geyer, the end of the week gives hope for more. It is still too early to call a trend break. Moreover, so far it is only a corrective movement in the overarching upward trend. “But even if turnover has not picked up significantly, the behavior of market participants in recent days shows that a certain willingness to buy has returned,” explains the chart technician. If the 19,500 point mark is overcome this week, there is a chance of a further run and thus reaching the 20,000 mark before the end of the year.
Ingredients for an upward trend
Robert Halver from Baader Bank is already looking ahead to 2025 and expects the stock markets to become more turbulent. “From Trump's inauguration in January at the latest, 'surprises' can be expected at any time.” However, “short-term headlines in a fundamentally sound situation” create attractive buying opportunities in the longer term. Overall, the ingredients for a future upward trend in equities are in place. “Despite the skirmishes, interest rate and tariff fears are not as hot as they are cooked. The global economy and corporate profits will grow in the longer term,” emphasizes Halver.
DZ Bank: “Positive outlook in a challenging environment”
According to DZ Bank, however, the upside potential for European share indices will remain limited until mid-2025. “Temporary improvements in sentiment will prove to be unsustainable and will always be offset by trouble spots and price setbacks,” explains analyst Christoph Müller. In the USA, on the other hand, the announcement and implementation of tax breaks and the economic flash in the pan will provide positive momentum on the stock markets. The bank expects the S&P 500 to reach 6,500 points by mid-2025 and 6,900 points by the end of 2025. Europe's stock markets will also get used to the new US president in the second half of the year. “Other topics, including corporate profits, monetary policy and artificial intelligence, are likely to come to the fore again.” For the DAX, the bank forecasts 19,500 points for the middle and 21,500 at the end of the year. “In view of geopolitical uncertainties and Trump's expected erratic leadership style, more volatility is also to be expected on both sides of the Atlantic.”
Important economic and business events of the week
Monday, 25 November
10.00 am. Germany: ifo Business Climate November.
Tuesday, 26 November
20.00. USA: Minutes of the US Federal Reserve meeting on November 6/7.
Wednesday, 27 November
2.30 pm. USA: New orders for durable goods October. The market expects an increase of 0.5 percent month-on-month after a decline of 0.7 percent in September.
16:00. USA: Price index for consumer spending excluding food and energy. The Federal Reserve's preferred measure of core inflation is expected to have risen from 2.7 to 2.8 percent in October, according to Deutsche Bank, with annual headline inflation rising from 2.1 to 2.3 percent. This would be in line with the development of consumer prices. If the increase is more pronounced, this makes a further cut in the key interest rate in December less likely.
Thursday, 28 November
USA: Thanksgiving. US markets remain closed.
14:00. Germany: Consumer prices November. Expected to be 2.3 percent year-on-year again, more than October's 2 percent.
Friday, 29 November
11.00 am. Eurozone: Consumer prices November. At 2.4 percent, the inflation rate is likely to have jumped well above the ECB target of 2 percent again, says Commerzbank. Although this is largely due to base effects, the core rate is also likely to rise again temporarily.
By Anna-Maria Borse, 25 November 2024, © Deutsche Börse AG
Deutsche Börse 
