The DAX index has recorded sharp losses in the Thursday session. Currently, the DAX is trading at 12,169, down 1.14% on the day. On the release front, eurozone and Germany Manufacturing PMIs missed their estimates. Eurozone Manufacturing PMI dropped to 56.6, down from 58.1 points. The German release slowed to 58.4, compared to the estimate of 59.8 points. German Ifo Business Climate also dipped to 114.7, matching the estimate.
The markets had priced in a rate hike from the Federal Reserve, and policymakers complied with a quarter-point increase on Wednesday, bringing the benchmark rate to a range between 1.50% and 1.75%. The markets were looking for any clues with regard to the pace of rate hikes in 2018 – currently the Fed is projecting three hikes, but a robust US economy could push the Fed to press the rate trigger four times. The rate statement did not directly address the issue, but there was a refreshing lack of Fedspeak from policymakers, who said that “the economic outlook has strengthened in recent months”. This phrase has not been used in previous rate statements, and the hawkish terminology helped send US markets lower on Wednesday, with the trend continuing on Thursday in European markets.
Thursday (March 22)
- 4:30 German Flash Manufacturing PMI. Estimate 59.8. Actual 58.4
- 4:30 German Flash Services PMI. Estimate 55.0. Actual 54.2
- 5:00 Eurozone Flash Manufacturing PMI. Estimate 58.1. Actual 56.6
- 5:00 Eurozone Flash Services PMI. Estimate 56.0. Actual 55.0
- 5:00 German Ifo Business Climate. Estimate 114.7. Actual 114.7
- 5:00 Eurozone Current Account. Estimate 30.2B. Actual 37.6B
- 5:00 ECB Economic Bulletin
*All release times are DST
*Key events are in bold
DAX, Thursday, March 22 at 7:50 EDT
Prev. Close: 12,309 Open: 12,177 High: 12,269 Low: 12,150 Close: 12,169
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