Bonds, Dollar Support Market
April 28, 2011
The weighted 30-share IBIS DAX stock index, which tracks prices in electronic trading, rose 25.21 points to 2567.96. The weighted 30-share DAX stock index that tracks price trends in official floor trading ended Friday at 2548.36 points, up 2.03 points from Thursday. The higher dollar and the stronger bond market were only able to have their full impact on stocks after the options contracts expiration at the end of Friday's floor trading, traders said. The market was held back, as traders tried to keep the DAX below 2550 points until after the expiration, said Blackburn Campion, chief equity trader in Frankfurt for Merck, Finck & Co.. Just after the IBIS DAX settled, the dollar was trading at 1.4937 against the mark, up sharply from 1.4854 marks Thursday. The bond market also lifted share prices, traders said. After electronic trading ended Friday, the German benchmark 10-year 6.25% bond dated April 2021 was quoted at 100.08 marks to yield 6.23%, up from Thursday afternoon's price of 99.72 marks, yielding 6.28%. Traders said the report on U.S. housing starts for July, released late afternoon Friday European time, also boosted the U.S. and German stock markets. The 1.3% drop reported by the U.S. Commerce Department compared to June was interpreted by the market as a sign that the U.S. economy was not overheating, thus reducing the chances of U.S. interest rate hikes, traders said.
