DAX Set for a Downward Opening Tech Giants Maintain Market Volatility

The reporting season for major US tech companies begins positively with strong results from Google, while the DAX faces challenges amid uncertainties like inflation and the US presidential election. The Nasdaq reaches a record high, but Asian markets show caution. BASF adjusts its 2024 outlook, Daimler Truck writes off receivables in China, and Alphabet reports growth attributed to AI investments. Meanwhile, AMD disappoints with underwhelming forecasts, and Visa experiences significant sales growth.

The earnings reports from major tech firms in the U.S. have started on a positive note, with Google achieving favorable results. The Nasdaq has already reached a new all-time high. However, the DAX is anticipated to face challenges.

Despite positive trends from the U.S. and Japanese markets, German investors are likely to remain cautious this midweek. Several uncertainties, including the upcoming U.S. presidential election and inflation data expected later today in Germany, are making investors hesitant.

Concerns surrounding the tariff dispute between the EU and China are also affecting investor sentiment. Market analyst Thomas Altmann from QC Partners noted that “a tariff spiral could severely impact stock markets.” Starting today, significant tariffs will be imposed on electric cars imported from China in Europe.

Will the DAX Support Hold?

The DAX has once again struggled at the resistance level around 19,600 points. It is now likely to test the support zone of 19,300 to 19,400 points, where buying interest has been seen in recent days. A fall below this threshold could risk a decline to the psychological level of 19,000 points.

Google Performs Well, AMD Disappoints

Tech sector performance has been mixed following the closing of the U.S. stock market. Alphabet, Google’s parent company, posted strong quarterly results, while chipmaker AMD fell short of expectations. Market participants are eagerly waiting for further earnings reports from major U.S. tech corporations, including Meta Platforms and Microsoft today, and Apple and Amazon later this week.

Nasdaq Hits Record High

The Nasdaq composite index reached a fresh record high yesterday, closing up by 0.8 percent at 18,712 points. In contrast, the Dow Jones closed down 0.4 percent at 42,233 points, while the broader S&P 500 index gained 0.2 percent, finishing at 5,832 points.

Technology Stocks Lift Nikkei

Buoyed by strong tech stocks following Nasdaq’s record, Japan’s Nikkei index rose to a two-week peak, increasing by 1.0 percent in late trading. Other Asian markets, conversely, are showing caution, weighed down by fears regarding the Chinese economy and the impending U.S. elections, with the Shanghai stock exchange down by 1.1 percent.

Gold Reaches New Record

In Asian trading, the euro was steady at 1.0815 dollars. Meanwhile, gold prices soared to a record high, reaching up to 2,785 dollars per ounce in the morning. This represents a remarkable 38% increase over the last year.

Oil Prices Supported by Inventory Data

Oil prices are stabilizing as industry reports indicated an unexpected decline in U.S. crude oil and gasoline inventories. After experiencing price drops due to easing tensions in the Middle East, Brent crude oil is now up 0.7 percent at 71.22 dollars per barrel (159 liters).

BASF Shows Caution for 2024

BASF, the world’s largest chemical provider and part of the DAX, has shared its financial outlook this morning. The company is adopting a cautious stance for the current year, anticipating earnings before interest, taxes, depreciation, and amortization to be at the lower end of a projected range between 8.0 and 8.6 billion euros. In the third quarter, their operating income rose by five percent to 1.6 billion euros, and net profit reached 287 million euros, a significant turnaround from a loss of 249 million euros last year.

Daimler Truck Writes Down Receivables in China

Daimler Truck is currently reviewing its operations in China, leading to a write-down of some receivables worth 180 million euros in the third quarter. The company, traded on the DAX, labeled this adjustment as a one-off, extraordinary non-cash item.

Alphabet Thrives on Cloud and Ad Revenue

Alphabet’s robust quarterly performance is attributed to a thriving cloud business and increased advertising revenues. “Our investments in artificial intelligence (AI) are bearing fruit,” stated CEO Sundar Pichai. The company’s revenue surged by 15 percent to 88.27 billion dollars in the last quarter, with cloud division growth exceeding expectations at more than double.

Waymo Achieves Milestone in Self-Driving Rides

Waymo, a sister company of Google,

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