Investors Worried About New Coronavirus from China
The Dax Index is trading lower today as investors become more worried about the ill-effects of the new coronavirus outbreak in China. Just like its Asian counterparts, Germany’s stock index is down. It is in the red by over 70 points or 0.52% at 13,478.72.
Out of the thirty stocks tracked by the DAX Index, only two are trading in the green: Fresenius Medical Care AG & Co. (+1.42%) and Fresenius SE & Co. (+0.27%). These shares belong in the healthcare industry and demand for masks and medicine is pushing their stock prices higher.
Risk aversion dominated market sentiment today following the announcement from WHO (World Health Organization) of an emergency meeting. Containment measures need to be put in place immediately as the virus has spread to 4 countries, infected 200 people, and resulted to the death of 4 individuals.
German ZEW Report on Deck
Perhaps the DAX Index could find reprieve from the bears’ advances when the German ZEW Economic Sentiment report comes out. Due at 10:00 am GMT, the report is expected to print at 15.2. A reading higher than the forecast could be bulllish for the DAX Index as it would indicate improving investor sentiment.
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DAX Index Outlook
On the hourly time frame, we can see that the DAX Index has retraced most of its gains back to the 61.8% Fib level (drawing the Fibonacci retracement tool from the low of January 16 to yesterday’s high). This price around 13,450.0 also coincides with the 100 SMA and 200 SMA. Reversal candlesticks around this level could mean that the stock index could soon make a run for its recent high at 13,578.4. On the other hand, a strong bearish candle closing below this level may indicate that the DAX Index could fall to 13,380.0 where it bottomed on January 16.
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