Many analysts see greater value in European stocks than US stocks which have already risen significantly due to COVID induced central bank support. The majority of investors are also wary of a 5-10% correction in stocks that are seen as being due. So, if there is a sharp correction lower on a hawkish Fed this week then the DAX could offer great value at cheaper prices.
Over the last 25 years, the DAX has risen 21 times between Oct 01 and Jan 01. The average rise has been 7.34% and the largest gain was in 1999 with a 31.73% rise. The largest fall was in 2008 with a large -14.35% loss.
Major Trade Risks: If the Fed are dovish next week, as expected, the DAX is unlikely to dip lower.
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