The 16,000 points for the Dax and a record high were reached on Friday - now the index is taking a breather.

At the beginning of the week, the Dax then fell temporarily on Monday by 0.7 percent to 15,870 points.

Analysts saw the main reasons for this in Asia.

Because China presented surprisingly weak economic data.

Both consumer pleasure and industrial production decreased measurably in July.

That is probably still due to the effects of the Covid-19 pandemic.

Jochen Stranzl from CMC Markets also has little hope that this will change in the near future: "As the number of infections continues to increase, the growth dynamic is likely to decline further in the coming weeks."

Markus Frühauf

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This also puts pressure on raw material prices in the broad market. One example would be the price of crude oil. If things don't run smoothly in the Chinese economy, there will be less demand for oil. Specifically, the Chinese refineries have cut their production in view of the high inventory levels and the associated low profits. As a result, crude oil processing fell in July to its lowest level since May 2020. This in turn leads to an oversupply and thus to falling oil prices. For example, crude oil from the North Sea Brent was 1.7 percent cheaper on Monday to $ 69.41. Accordingly, the European sector index for the oil industry also lost. In this weaker environment, investors in Germany therefore opted for more defensive stocks.

In contrast, the situation in Afghanistan plays only a very minor role in the markets. It's cynical, but the humanitarian catastrophe that is happening there right now has no bearing on the global economy. It was said, however, that the associated uncertainties should be kept in view on the stock exchange.

This mélange of topics in connection with the easing inflation worries pushed the yield on the ten-year US Treasury bond down to 1.245 percent on Monday. On Thursday it was still 1.375 percent. The decline in yields goes hand in hand with rising bond prices. These are the result of greater caution on the part of investors, who are increasingly switching money into government bonds, which are more stable in value than stocks. Bunds were also in demand, even if the price gains were not as significant as those of American stocks. The yield on ten-year government bonds was down on Monday at minus 0.482 percent after minus 0.441 percent on Friday.

DZ Bank analyst René Albrecht also attributes the caution of investors to the capture of the Afghan capital by the radical Islamic Taliban as well as increasing concerns about the Covid pandemic in Asia. In his opinion, the trigger for the decline in US yields on Friday was the University of Michigan consumer confidence index in the United States. This is considered a leading indicator for the American economy and has been the weakest since 2011. This also influences the discussion in the US Federal Reserve about reducing bond purchases from currently 120 billion dollars a month.

After the recent good labor market report, there are increasing voices to wait for further reports before deciding on a reduction in bond purchases. Only then, according to Neel Kashkari, President of the Minneapolis Fed, can it be seen whether the economic recovery has progressed sufficiently. The aim is to put the labor market in a position before the outbreak of the pandemic. Investors are hoping for further conclusions in this area from the minutes of the July meeting of the US Federal Reserve, which will be published this week.

The prospect that monetary policy support will not be scaled back in the United States for the time being has not only depressed yields on the bond market, but has also given the euro some respite. On Monday it hovered around the $ 1.18 mark, a little higher than the previous week.