Stock market forecast: Financial expert warns of losses due to high interest rates and conflicts in the Middle East. Automotive industry could be particularly affected.

Stock market forecast: Financial expert warns of losses due to high interest rates and conflicts in the Middle East. Automotive industry could be particularly affected.

According to a report from www.nzz.ch, German financial market expert Jens Ehrhardt expects losses in stocks due to high interest rates and the conflict in the Middle East. In particular, he is skeptical about the automotive industry in Germany. Ehrhardt predicts that interest rates will remain high for longer.

The Hamas attack on Israel initially did not lead to losses on the stock markets, but the situation has now changed. In the past, war has sometimes been a good time to get into stocks, but this time prices have fallen. Further escalation of the conflict could lead to further price losses, especially if oil prices rise.

If the price of oil rises significantly, this could put a strain on the economy and increase inflation, which in turn could lead to higher interest rates. Many market participants are currently assuming that inflation will continue to decline and that interest rates in the USA will therefore fall. However, higher oil prices could dash these expectations.

The European economy could contract more sharply than expected, while there is more tailwind in the USA. Therefore, it could be attractive for franc investors to invest in dollar bonds without hedging the currency risk. The dollar is currently considered a safe haven and dollar bonds offer a better return compared to European bonds.

Interest rates are expected to remain high for longer. However, this could lead to problems in the private credit sector in the USA, especially for over-the-counter loans. Such a situation could trigger a major crisis. In the event of such an accident, the Federal Reserve could potentially pump liquidity into the market, which could lead to losses in the stock market.

Overall, the risks on the stock market currently predominate, especially for the shares of the “Glorious Seven” – Meta, Apple, Amazon, Microsoft, Nvidia, Alphabet and Netflix. Historically, these stocks could also end up suffering price losses.

Overall, the analysis suggests that uncertainty due to high interest rates and conflict in the Middle East could lead to losses for stocks. The automotive industry in Germany is particularly at risk. A further increase in the price of oil could weigh on the economy and lead to higher interest rates. Investors could therefore invest in dollar bonds to minimize currency risk. There is also the risk of a major crisis in the private credit sector in the USA. The shares of the “Glorious Seven” could also suffer price losses.