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After spending most of the session in the red following an early drop from a higher opening the DAX 30 has swung steeply into positive territory as Mario Draghi speaks to the press following the ECB meeting this morning. The outcome of the meeting was little outcome as the status quo was retained in terms of keeping interests at their present levels and maintaining the monetary easing schedule as is. However, markets are still interested in what Draghi has to say in terms of future guidance and the equity markets are clearly liking what they hear with the press conference in progress.
After recording modest gains yesterday the DAX opened the day up on yesterday’s close. Morning losses are being clawed back at present with the index’s two banks recording strong gains after Federal Reserve boss Janet Yellen confirmed the expected pace of interest rate hikes in 2017 and offered forward guidance that is expected to continue into 2019. She also took a particularly hawkish position on the near-term strength of the U.S. economy, boosting market confidence. Commerzbank is going particularly strongly, up over 4%, while Deutsche Bank has added 1.57%. Both stocks are quickly climbing at the time of writing.
Lufthansa, the subject of speculation on Tuesday around a merger, part or total, with Abu Dhabi carrier Etihad, which saw a sharp increase in its share price, has added 0.56% today. While a good chunk of initial gains were quickly reversed after analysts raised doubts about the practical feasibility of such an eventuality, the share price is still considerably up on where it was before the story broke. This would indicate that markets have not dismissed the possibility that there is something to what both airlines described as ‘speculation’.
The day’s heaviest faller so far is steelmaker ThyssenKrupp, down 1.57%. The company’s share price has had a very positive start to the year on rising steel prices, which have been boosted by China reducing output on environmental concerns. Housing association Vonovia is down 1.5% while consumer goods giant Henkel and Merck, the pharmaceuticals firm are showing respective losses of 1.31% and 1.11% respectively.
