The German leading index to continue its pursuit of a record. He rose on Monday to a new all-time high of 13.904 points. Why investors are so optimistic.
The German stock index Dax is started with an additional record into the new year. The stock market barometer topped on Monday, shortly after Christmas and reached the best mark knapp and climbed up on 13.904 points to the top.
Recently, the benchmark index was quoted at 13.901,52 points 1.33 percent above its year-end 2020. The past turbulent year, the Dax had finished with a Plus of around 3.5 percent. It was, however, since the Corona-Crash Low in March, at around 8.255 points to about two-thirds gone.
Investors bet on a success in many countries, meanwhile, launched campaigns against the Coronavirus. To the success of uses – it can still take months – will attack the governments and Central banks in the economy also continues to be strong under the arms, so the calculus.
In addition to the beginning of the vaccinations, Christopher Wood, chief equity strategist of the investment house Jefferies refers to a well-sustained readiness of the Central banks and governments around the world to engage in the economy for the time being, if necessary, with a lot of money under the arms, around the Corona mitigate the consequences.
Rising Inflation could be a Problem
A risk is, however, calculated that investors could focus on a more fast-paced recovery of the economy. As a result, the long-term interest rate expectations rise, the yield curve will therefore be steeper.
In such a signs of a potentially rising Inflation it’d depend heavily on the reaction of the Central banks. For example, the US Central Bank, the Fed should signal a containment of their cheap money flood, it would hit the stock markets hard.