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Global Markets React to ECB Rate Cut
2024-09-13 05:50:08
Markets
Economy
Business

Global Markets React to ECB Rate Cut

The DAX saw a recovery following the ECB's decision to cut the interest rate by 0.25 percentage points to 3.5%. This move, endorsed by economists, is expected to be followed by another cut later in the year.

European markets, including the MDax and EuroStoxx 50, also rose, and bond yields increased. Meanwhile, U.S. tech stocks surged despite persistent core inflation, boosting indices like the Nasdaq 100. Asian markets followed suit, driven by Wall Street's positive cues.

Additionally, oil prices rebounded due to hurricane-related disruptions, and the Commerzbank aims to remain independent amid takeover rumors. Finally, Airbus secured a significant order from China Development Bank for 80 A320neo aircraft.

Related news on that topic:

ECB Cuts Interest Rates to Stimulate Eurozone Economy

The European Central Bank (ECB) has reduced its deposit rate to 3.50% and the main refinancing rate to 3.65% in an effort to stimulate lending and stabilize market interest rates. This decision aims to make borrowing more affordable for businesses, while yielding lower returns on savings. The ECB's objective is to steer inflation back to its target of 2%, following a period of high inflation that peaked at over 10% last year. The bank will adopt a meeting-by-meeting approach to determine the appropriate level of interest rates, with the next evaluation scheduled for October. Despite the easing inflation, which has fallen to 2.2%, core inflation remains elevated at 2.8%, prompting caution from the Bundesbank against rapid policy loosening. The ECB's rate cut is intended to balance economic stimulation with price stability, ensuring that neither high inflation nor deflation hampers economic activity. This move follows a series of ten consecutive rate hikes aimed at combating inflation triggered by geopolitical tensions, such as the Russian invasion of Ukraine. While the lower interest rates are expected to boost investment and consumption, savers may face diminished returns on deposits and life insurance policies.

Market Volatility Amid Fed Decisions and Company Performance

The Dax stabilizes following losses, as investors anxiously await the Fed's interest rate decisions. Adidas experiences a 3% stock drop due to weakened demand in China and heightened competition. Concerns loom over possible market downturns triggered by recession fears and the impending Fed announcement. Global markets react unevenly, with Wall Street seeing gains, while Asian markets show mixed results. Euro and gold prices hold firm, while oil prices remain steady. Oracle surpasses expectations with robust cloud business, and Apple emphasizes camera and AI features in new iPhone models. Amidst uncertainties, European futures remain steady awaiting US inflation data and traders navigate political unknowns ahead of the US election debate.

Read 23 more recent news on this topic

The press radar on this topic:

Tagesschau - Wirtschaft und Börsen-Nachrichten
12. September 2024 um 20:12

DAX Higher Expected Gains Before ECB Decision?

Finance
Economy
As of: 12.09.2024 07:48 AM The hope of investors for lower interest rates is supporting the German stock market. Also thanks to positive signals from the US stock exchanges, the DAX is expected to rise above the 18,500 point mark before the ECB decision. On the day of the interest rate decision by the European Central Bank (ECB), the DAX is likely to take up the tailwind from Wall Street and climb back above the 18,500 point mark. The broker IG estimates the German leading index to be 1 percent..
EuroNews
12. September 2024 um 19:30

The European Central Bank cuts interest rates as inflation declines and economic growth slows

Economy
Finance
Politics
The European Central Bank has cut interest rates due to a decline in inflation and a slowdown in economic growth in the eurozone. The interest rate on main refinancing operations has become 3.65%, the interest rate on the marginal lending facility has reached 3.90%, and the interest rate on deposits is 3.50%.
focus
12. September 2024 um 16:31

Daily Summary - DAX recovers thanks to ECB decision in the evening

Finance
Economy
Technology
The DAX recovered on Thursday thanks to the ECB's 0.25 percentage point interest rate cut to 3.5 percent. According to HQ Trust chief economist Michael Heise, the interest rate cut is appropriate, and he expects a further cut by the end of the year. The MDax, the EuroStoxx 50 and the national stock exchanges also gained, while yields rose in the bond market.
derstandard
13. September 2024 um 03:00

What the ECB's interest rate cut will bring us

Economy
Finance
The European Central Bank has lowered its key interest rate to 3.5 percent. This is likely to have an impact on consumers who have their money invested in a daily savings account or are taking out a construction loan.
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