Germany 30: January 2020 Outlook
With an annual growth of 25.5%, the Germany 30, aka DAX 30, had a great 2019. Upbeat investor sentiment on reduced risk of a recession in the near future and optimism over de-escalation of the US-China trade war were the primary reasons for the gains. Germany’s manufacturing sector did take a hit in 2019, thanks to the tussle between Beijing and Washington. However, that does mean that positive news on trade later this month may see the DAX 30 surge. The DAX 30 started December at 12982.8, reaching 13249.01 by December 30, 2019.
Economic Data to Look Out For: January 2020 Outlook
January 8, 2020: Factory Orders MoM November 2019
German factory orders dropped 0.4% from the previous month, in October 2019. Domestic demand also fell 3.2%. The markets expect an improvement in factory orders, at an increase of 0.2%. Any significant drop this time could move the markets.
January 9, 2020: Germany Balance of Trade November 2019
In October 2019, Germany’s trade surplus increased to €21.5 billion, on a year-on-year basis. The markets expect this figure to narrow to €19.9 billion for November 2019.
January 15, 2020: Germany GDP Growth 2019
Economic growth stood at 0.5% year-on-year in Q3 2019. The country narrowly avoided recession in the last quarter. The markets expect some improvement in the final quarter of 2019.
January 15, 2020: Euro Area Balance of Trade November 2019
Trade surplus for the Eurozone stood at €28 billion for October 2019, the highest since March 2017. It is expected to decline to €19.9 billion by November 2019.
January 16, 2020: Germany Inflation Rate December 2019
Economists are bracing for a 1.5% increase in the inflation rate, on a year-on-year basis, for December 2019. This will be the highest since July 2017. In case of a higher-than-expected inflation rate, the markets could move significantly.
January 17, 2020: Euro Area Inflation Rate December 2019
The inflation rate in the overall Eurozone stood at 1.0% in November 2019. An increase in the prices of non-energy industrial goods, food and services could lead to a further hike of 1.2% in December 2019.
January 20, 2020: Germany PPI YoY December 2019
The Producer Price Index (PPI) dropped 0.7% in November 2019, from the November 2018 levels. This was the lowest since September 2016. For December 2019, the PPI is expected to decline another 0.1%, on a YoY basis.
January 2020 Predictions: Political Events That Could Impact the Germany 30
The DAX 30 started 2020 on a good note, with better than expected German manufacturing PMI. The soon-to-be-signed preliminary trade deal between the US and China, on January 15, 2020, could impact the DAX 30.
Brexit developments will also move the market, with the UK scheduled to leave the EU at 11pm London time, on January 31, 2020. Financial services companies on the DAX might be impacted.
January 2020 Predictions: Other Factors That Could Impact the DAX 30
Crude oil prices could fluctuate due to extreme weather conditions. OPEC supply cuts and the US-Iran conflict could make the news.