The DAX has ticked lower in the Wednesday session. Currently, the DAX is at 13,358.50, down 0.16% on the day. There are no major events in the eurozone on the schedule. France posted a trade deficit of EUR 4.7 billion, which matched the estimate. On Thursday, Germany releases Trade Balance and the US publishes unemployment claims.
European stock markets dipped on Tuesday, as investors were not impressed with European corporate earnings. The DAX dropped 1.0 percent, and financial stocks were in red territory – Deutsche Bank dropped 0.59% and Commerzbank slid 1.53 percent. The DAX continues to head lower on Wednesday.
Eurozone retail sales rebounded sharply in September, pointing to an improvement in consumer spending. The gain of 0.7% came after two straight declines, and marked the strongest gain since February. The markets are hoping for strong eurozone consumer spending in the fourth quarter, given the robust German economy and stronger economic conditions in the eurozone.
After failing to pass a new healthcare act, President Trump has his sights set on tax reform, a key item in his domestic platform. Trump wants Congress to pass legislation overhauling the tax code before the end of the year, but that could prove to be too tight of a deadline. Most Democrats have come out against the proposal, and not all Republicans are on board. The bill would cut corporate taxes from 35% to 20%, but predictably, Democrat and Republican lawmakers are at odds as to whether the bill will lower taxes for the middle class. The bill is presently being debated in a congressional committee and is expected to move to the House floor next week. The Senate will present its version of the bill on Thursday, so we can expect plenty of activity in Congress in the next few weeks. Expectations that Trump will cut taxes has been the catalyst for a stock market rally over the past year, and if the bill does become law, the US dollar will likely gain ground.
Wednesday (November 8)
- There are no German or eurozone events
Thursday (November 9)
- 2:00 German Trade Balance. Estimate 21.0B
- 4:00 ECB Economic Bulletin
- 5:00 EU Economic Forecasts
*All release times are GMT
*Key events are in bold
DAX, Wednesday, November 8 at 6:45 EDT
Open: 13,398.50 High: 13,420.50 Low: 13,349.50 Close: 13,358.50