The DAX index commenced trading Wednesday with minor losses. Around 09:30, the leading index stood at approximately 24,185 points, representing a decrease of 0.1 percent compared to the previous day’s closing level. Among the top performers were Porsche, Siemens Healthineers and BASF, while Adidas, Symrise and Hannover Rück concluded the session lower.
The key event of the day is the latest interest rate decision from the U.S. Federal Reserve, scheduled for release later this evening. According to Thomas Altmann of QC Partners, “It’s another Fed day. A change to the U.S. key interest rate is considered unlikely for today”. Attention will be focused on how Fed Chair Jerome Powell assesses the impact of recent trade agreements on the inflation rate during the accompanying press conference.
Market sentiment currently anticipates a potential interest rate reduction in October. Commentary suggests that the remaining meetings under Jerome Powell’s leadership as Fed president are being closely monitored. There are currently seven such meetings remaining.
Altmann noted that the DAX appears to be constrained within a defined trading range. For roughly three weeks, the index has been fluctuating sideways between approximately 23,900 and 24,500 points. “It seems as though no one wants to re-position significantly at the moment. The fear of being on the wrong side is palpable”. Despite the sustained high-level trading, hedging activity via put options remains below average. The market expert emphasized that “this low hedging ratio represents a significant risk for future price movements”.
