The DAX ultimately managed to gain ground on Thursday despite considerable volatility. By the close of trading on Xetra, the index reached 26,003 points, marking an increase of 0.6 points compared to the closing value of the previous day.
This positive movement was supported by encouraging early signs in Wall Street, where investors seem optimistic about labor market data expected to be released on Friday.
The release of the European Purchasing Managers’ Index on Thursday revealed a mixed picture across the continent. While the uptrend continues in Germany, the economy has not yet transitioned into a clear expansion phase. A noticeable drag, however, came from producer prices, as increases were higher than anticipated by 0.2 percentage points. Andreas Lipkow of CMC Markets commented that this situation illustrates the effects of rising energy costs.
In the US, labor market figures and the trade balance slightly surpassed expectations, helping push American indexes higher. Lipkow also noted that statements from Federal Reserve member Waller provided additional support, as Waller advocated for a pause in interest rate hikes in September, a move related to the upcoming revision of the inflation rate via the recalculation of the PCE Deflator.
Currently, the movements of the Japanese Yen against the US Dollar and the Euro are attracting significant attention. Investors are drawn back to a period from two years ago when turbulence hit international financial markets following interventions and discussions regarding a possible interest rate hike by the Bank of Japan. The Japanese Yen is frequently used in “Carry-Trades,” a strategy where investors borrow Yen and invest the resulting funds in US and European assets.
Looking at currency exchanges, the common European currency was slightly stronger against the Dollar on Thursday afternoon compared to the preceding day. Specifically, one Euro was trading at $1.1624, while a Dollar was available for 0.8603 Euros.
