FRANKFURT (dpa-AFX) – Before the central bankers meeting in Jackson Hole, investors remain optimistic for real estate stocks. With a rise of 1.5 percent in the sector index, these were the biggest winners across Europe on Thursday. The recovery thus continued with momentum for the third day. In the Dax, Vonovia shares stood out with an increase of two percent. Within three days, they have now gained more than seven percent.
Most sector stocks in the German small cap indices also followed this strength: LEG and TAG Immobilien led the way in the MDax with gains of up to 2.8 percent, while Aroundtown shares in the SDax, which have been particularly battered over the past two years, rose by four percent.
Traders spoke of a sharp countermovement in the bond market, which indirectly affected real estate stocks. Investors had positioned themselves for higher market interest rates before the central bankers’ conference in Jackson Hole, but had been caught off guard by disappointing economic indicators the previous day. Recently, the theme is that expectations are weakening with regard to further interest rate hikes.
A surprisingly significant deterioration in sentiment in the German service sector had again fed fears of economic weakness on Wednesday. In the eyes of some investors, this reduces the chance that the European Central Bank will continue to turn the interest rate screw. This is seen as “grist to the mill of the real estate sector,” which has been dealt a severe blow by high interest rates in recent months.
The decision on whether the brightened sector sentiment will continue could come in Jackson Hole. That’s where the annual central bankers meeting begins Thursday. Investors are hoping for clues as to whether the future monetary policy course of the U.S. monetary guardians will bring further interest rate hikes. The most important event will be an appearance by Fed Chairman Jerome Powell on Friday, Commerzbank said this morning.
According to Borsians, Powell is widely expected to present an updated outlook. But according to UBS economist Jonathan Pingle, it is still too early to declare victory over inflation and an end to the tightening cycle. That’s because it’s still too dependent on how the economic data develops, he says. He rather expects Powell to maintain a certain restrictive stance and leave the door open for further rate hikes. However, he is unlikely to talk specifically about a further interest rate hike for the next decision in September, expects Pingle./tih/bek/jha/