2023-12-29 09:33:32
The 2023 stock year positively surprised many investors. Despite geopolitical crises and wars, rising interest rates and high inflation, it was an extremely profitable one. Many strategists are now rather cautious about their forecasts for 2024. This is the result of the traditional FAZ survey that has been carried out for more than 20 years. The 28 financial institutions surveyed this year believe that the DAX will achieve an average increase of 3 percent to 17,167 points. They predict an increase of 3 percent for the Euro Stoxx 50. The American Dow Jones could therefore gain 2 percent, the technology-heavy Nasdaq Composite 9 percent. For the Dax, even the rather meager average value promises new records again. The most recent high of 17,003 points is only a few days old.
The expectations of the houses surveyed differ significantly, and the range of forecasts is wide. For the Dax, the values mentioned for the end of 2024 range from 14,500 points by the French asset manager Carmignac to 18,000 points, predicted by six houses – Aramea Asset Management, Berenberg, LBBW, MMWarburg. Oddo BHF and Raiffeisen Bank International.
At the middle of the year, some forecasts are even higher at 18,500 points, including those of the year-end pessimist Carmignac, but also that of MMWarburg. Over the next six months, the lowest forecast of 13,850 DAX points comes from Bank of America, and 14,000 points is given by Société Générale. If these forecasts were correct, the DAX would lose at least 16 percent in value. In the best case scenario, the index would be able to increase by up to 8 percent at the end of the year and even 11 percent by the middle of the year.
The monetary policy of the central banks becomes decisive for prices
The resilience of the global economy is remarkable given the diverse and numerous stress factors, says Carsten Klude, chief economist at MMWarburg. After no stone was left unturned in 2022 and almost all forecasts had to be significantly revised over the course of the year, 2023 was quieter. The overall subdued global economic development is primarily due to the still high, albeit declining, inflation rates and the restrictive monetary policy of the central banks.
Although price increases have fallen significantly in almost all countries, they are still often at a level that is uncomfortably high for central banks, says Klude. The interest rate increase cycle therefore continued almost everywhere in 2023, so that the restrictive monetary policy proved to be the biggest brake on the economy. Regardless of all the burdens, the stock markets would have made up for a large part of the losses suffered in 2022, which would not necessarily have been expected given the news situation.
Despite all the uncertainties, the 2024 stock market year should be similarly positive, says Klude. The price increases of the past few weeks should continue. Even if the economic development probably only had a few positive impulses for the stock markets, the potential disruption from this direction was small. The monetary policy of the central banks will be more decisive for the prices. The end of the interest rate hike cycle and the interest rate cuts expected over the course of 2024 are likely to provide further tailwind for stock and bond markets, so investors should remain invested.
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