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Central bank signals weigh on markets: Moderate valuation speaks for stocks
According to a report from www.boersen-zeitung.de, the signals from central banks have a strong influence on the markets. The Fed's decision not to raise interest rates further for the time being has led to a collapse in the stock markets. Nevertheless, the door remains open for future interest rate increases and investors must prepare for continued high interest rates to combat inflation. Experts such as Ines Roth from DZ Bank assume that the probability of the Fed raising interest rates further in November outweighs the likelihood. In addition, the Fed expects only two interest rate increases in the USA next year, in contrast to the previously forecast four interest rate increases by...
Central bank signals weigh on markets: Moderate valuation speaks for stocks
According to a report by www.boersen-zeitung.de, the signals from central banks have a strong influence on the markets. The Fed's decision not to raise interest rates further for the time being has led to a collapse in the stock markets. Nevertheless, the door remains open for future interest rate increases and investors must prepare for continued high interest rates to combat inflation.
Experts such as Ines Roth from DZ Bank assume that the probability of the Fed raising interest rates further in November outweighs the likelihood. In addition, the Fed only expects two interest rate increases in the USA next year, in contrast to the previously forecast four interest rate increases by the end of 2024. This has led to a clear reaction from the stock markets, with the DAX collapsing but still holding the 200-day line for the time being.
Despite these developments, Claudia Windt from Helaba speaks in favor of investing in the stock market. She argues that the weak German economy has already been priced in and the US economy remains robust. In addition, a slight upturn in the purchasing managers' indices suggests that inflation is continuing to decline. Windt expects inflation data from Germany and the euro area to fall further in the coming week. In addition, stocks in this country remain moderately valued, which suggests a recovery from recent losses.
Sven Streibel from DZ Bank is also optimistic and believes that the negative impact of the tighter interest rate policy on the stock market could remain limited. However, he emphasizes that the resilience of corporate profits is crucial in the current market phase. In addition, he expects the currently record-high P/E valuation difference between US and European stocks to narrow.
Overall, these developments show that the financial markets react sensitively to the signals from the central banks. The forecasts for future interest rate hikes and economic developments have a direct impact on the valuation of stocks and can influence market sentiment. It remains to be seen how the markets will develop in the coming weeks and what measures the central banks will take to ensure economic stability.
Read the source article at www.boersen-zeitung.de