The DAX has posted more gains on Tuesday, after starting the week with excellent gains. Currently, the DAX is trading at 11.652, up 1.1% on the day. It’s a quiet day on the release front, with just one event. Eurozone PPI dipped to 0.1%, shy of the estimate of 0.2%. On Wednesday, Germany and the eurozone release services PMIs, and the eurozone will also post retail sales.
The DAX soared on Monday, posting its best daily gains since mid-February. The index jumped 1.35%, despite a weak German manufacturing PMI. Investors ignored the soft German data, focusing on Chinese data instead. The Chinese Caixin Manufacturing PMI didn’t sparkle, but improved to 50.8 and easily beat the estimate of 50.1 points. Investors cheered as the indicator climbed to an 8-month high, after posting three successive releases indicating contraction. The Chinese economy has been hit hard by the trade war with the U.S., and a piece of good news sparked strong gains on the equity markets.
Investors have become used to lukewarm data out of the eurozone and Germany, but are also discovering that the mighty U.S. economy is showing signs of slowing down. Retail sales, the primary gauge of consumer spending, looked dismal in March. The indicator declined by 0.2%, shy of the estimate of +0.3%. Core retail sales declined by 0.4%, a sharp drop from the 0.9% gain a month earlier. Both indicators posted a second decline in three months, which is bound to raise concerns about the strength of the economy. Growth for the first quarter could be as low as 0.8% annualized, compared to 2.2% in the fourth quarter.
Tuesday (April 2)
- 5:00 Eurozone PPI. Estimate 0.2%. Actual 0.1%
Wednesday (April 3)
- 3:55 German Final Services PMI. Estimate 54.9
- 4:00 Eurozone Final Services PMI. Estimate 52.7
- 5:00 Eurozone Retail Sales. Estimate 0.2%
*All release times are DST
*Key events are in bold
DAX, Monday, April 2 at 6:40 EST
Previous Close: 11,680 Open: 11,687 Low: 11,658 High: 11,744 Close: 11,733
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