Stock Market Movements Prior to Fed Decision: SAP Records Recovery, Puma Experiences Significant Surge
The DAX, Germany's blue-chip index, showed signs of recovery on Wednesday, gaining 0.13 percent to 23,359 points. One of the key factors influencing this stabilization is the anticipation surrounding Federal Reserve Chairman Jerome Powell's upcoming speech on the stock market today.
SAP, a heavyweight in the DAX, made a recovery attempt after a two-month downturn. The tech giant gained 3.2 percent and took the lead in the index, as market strategists believe Powell's rhetoric could set the course for stock prices in the coming weeks and months.
The focus is on the future outlook of the Federal Reserve's decision, with expectations high for the first interest rate cut this year. Reports suggest that Powell's message on the stock market today will emphasize central bank independence and careful data-driven policy adjustments. This stance may lead to cautious optimism in the stock market today, as investors anticipate easing monetary policy but remain wary of inflation risks.
Meanwhile, the high-tech chip dispute between China and the US continues to be a topic of interest. A media report suggested that China is demanding that its tech companies refrain from using AI computer chips from US industry giant Nvidia. This step could escalate the dispute and dampen the AI hype.
Elsewhere, Wacker Chemie lost 0.2 percent following a double downgrade by US bank Morgan Stanley, now assigned an "underweight" rating. On the other hand, Kontron gained 7 percent in the SDAX due to a positive assessment from MWB Research.
In the world of media, ProSiebenSat.1 lost 2.4 percent after two houses, Oddo BHF and Kepler Cheuvreux, downgraded the company. In contrast, Puma led the MDAX with a 16.8 percent jump in share price.
Two investors, financial investor CVC and US brand management company Authentic Brands Group (ABG), are interested in the stake in the sports equipment manufacturer held by major shareholder Pinault. Additionally, there have already been speculations about an Adidas takeover of Puma.
Schaeffler continued to gain, with shares up another 7.4 percent due to market reception of its new medium-term targets. Formycon's shares rose 3.5 percent due to a new distribution partnership for its biosimilar to Bayer's eye medication Eylea.
The DAX previously fell to its lowest level since June on Tuesday, but with Powell's speech approaching, the market may see further fluctuations as investors react to the Fed Chair's word choice on the stock market today.
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