DAX Under Pressure as Markets Eye Catalonia Vote

The DAX index has ticked lower on Thursday, after recording losses in the Tuesday and Wednesday sessions. Currently, the index is at 13,067.50, down 0.01% on the day. There are no eurozone events on the schedule. In the US, today’s key event is Final GDP. On Friday, Germany releases GfK Consumer Climate, an important gauge of consumer confidence.

European stock markets have been under pressure all week, and the DAX has declined by 1 percent. The slide could continue, as the markets anxiously await the results of the Catalan election. Spain was rocked by political uncertainty earlier this year, as the Catalan government declared independence from Spain. The national government declared the move illegal and promptly clamped down with direct rule on the region. The election campaign between nationalists and secessionists has been bitter and divisive, and no clear winner is expected, which could mean a hung parliament and more uncertainty ahead.

The Republicans and President Trump are walking tall on Thursday, after celebrating their first major legislative victory in Congress since Trump became president. On Wednesday, the House of Representatives voted for to pass Trump’s tax reform bill, after it narrowly passed in the Senate, by a vote of 51-48. Trump is expected to sign the bill into law next week. The tax legislation marks the first major overhaul of the US tax code in 30 years, and reduces corporate taxes from 35% to 21%. After failing to overturn Obamacare, the Republicans finally scored a big win, and will now have to sell the tax plan to a skeptical public, with congressional elections slated for November 2018.

Economic Calendar

Wednesday (December 20)

• 2:00 German PPI. Estimate 0.2%. Actual 0.1%
• 4:00 Eurozone Current Account. Estimate 33.4B. Actual 30.8B
• 8:00 German Buba President Jens Weidmann Speaks

Thursday (December 21)

• 8:30 US Final GDP. Estimate 3.3%

*All release times are GMT

*Key events are in bold

DAX, Thursday, December 22 at 6:20 EDT

Open: 13,066.50 High: 13,072.50 Low: 13,012.50 Close: 13,067.50

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