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The stock market is afraid of a second block. The Dax accelerates its slide over the course of the day and collapses by more than four percent. The memories of spring return.
By Angela Göpfert, boerse.ARD.de
At today’s summit on the crown crisis by the federal and state governments, radical measures are likely to be decided. At least that’s what investors believe and they flee mid-week. The Dax plunges up to 4.2 percent to 11,555 points. This is the lowest level since the end of May.
Learn more about the Dax course
The price losses from the early September high of 13,460 points are more than 14 percent. Since the beginning of the week alone, the leading German index has lost more than 1,000 points.
Lockdown is priced in
“The fear of a second freeze is ongoing at the base of the Frankfurt stock exchange,” says analyst Christian Henke of brokerage firm IG. The market has begun to incorporate further blocks – partially or completely – into the courses, according to broker Axi analyst Milan Cutkovic.
“The stock exchanges have been infected with Covid-19 for the second time this year,” said QC Partners portfolio manager Thomas Altmann. Only a few wanted to reach the falling knife, points out Jochen Stanzl, chief market analyst at CMC Markets.
Especially from a technical standpoint, the other DAX outlook has clearly clouded with the current price slump. With the slide below the all-important 200-day line (currently at 12,126 points), the German standard values are in rough waters.
Desperate for safe havens
Given the heavy losses on the stock market, investors are fleeing to “safe havens”. But gold is apparently no longer one of them. The price of gold even dropped slightly to around $ 1,900 per troy ounce.
Bitcoin, on the other hand, has experienced significant price increases, as the price of the world’s best known cryptocurrency has soared to over $ 13,600 on the Bitstamp exchange, the highest level in over two years.
“The younger generation, who also invaded the stock market due to the pandemic, seem to prefer Bitcoin to gold,” said Stanzl, an expert at CMC Markets.
Learn more about gold prices in US dollars
Read more about Bitcoin prices in US dollars
Many memories and great uncertainties
All in all, the current stock market crisis brings to mind strong memories of spring 2020. Will the March scenario repeat itself? Will the dramatic stock market crash be followed by another equally dramatic recovery? So are these now buying courses? These questions push investors into the middle of the week.
No expert to be taken seriously is currently willing to give a clear answer. We still don’t know what exact measures the politicians will take. We do not yet know if and when these measures will take effect, if they will be sufficient.
And we still don’t know how central banks will react to the aggravated situation. The European Central Bank will meet tomorrow, next week will be the turn of the US Federal Reserve. There are many uncertainties, too many for markets to sustainably recover right now.
New recovery just a matter of time?
At the latest, however, when central banks promise new aid, a gigantic package of economic stimuli is launched in the US after the presidential elections and perhaps new economic stimuli are adopted in this country as well, even the markets should recover.
Then there would be a new fear on the stock market: the fear of losing the second recovery of Corona on the stock market.
Those: boerse.ard.de
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