According to the Munich-based ifo Institute, the downward trend in the manufacturing sector did not continue in October. Although company bosses once again assessed current business as worse, their expectations were less pessimistic. This is the first step on the road to a better future. As a reminder: according to the diction of economic researchers, it takes three consecutive increases in business expectations to establish a new positive trend. However, it will take some time until then. If Donald Trump wins the US election, there is a high probability that expectations will deteriorate again.The economic component of the private wealth stock market indicator therefore remains ‘red’ for the time being.A particularly interesting constellation...

The core sectors of German industry are in trouble, according to the ifo Institute's latest business climate index for September. In fact, the business climate has been trending downwards since mid-2021 and has now reached its lowest level since the deep recession of 2008/2009 - at least if the three extreme coronavirus shock months in spring 2020 are excluded. The situation is bad, the lack of orders has worsened and expectations in the boardrooms are becoming increasingly pessimistic. A month ago, the private wealth stock market indicator had already interpreted the dramatic deterioration in business expectations in industry as a downward economic trend reversal and reduced the equity allocation accordingly. Unfortunately, this negative...

The ifo business climate survey for August leaves no doubt: German industry is sliding further into crisis. The economic component of the private wealth stock market indicator thus switches from amber to red. Background: If business expectations in industry deteriorate three times in a row after a sustained upturn, this has often signalled a downward economic trend reversal in the past. In such a phase, it often becomes difficult on the stock market. This is why the private wealth stock market indicator then reduces the equity allocation. From September 2023 to May 2024, business expectations in the manufacturing sector initially improved gradually from minus 29 to minus 6.4. There were hopes of an imminent upturn in industry. This has...

At the end of July, the results of the private wealth stock market indicator made it seem advisable to significantly reduce the equity allocation from 110 per cent of the individually planned equity allocation to 90 per cent and to increase the cash allocation accordingly. The main reason for this was the slowdown in the German economy. According to the ifo Institute, 43.6 per cent of respondents from domestic industry now report a lack of orders. As published at the time, only the sustained positive probability landscape of the capital market seismograph prevented an even more drastic reduction in the share quota. This raises the interesting question: How is the seismograph reacting to the recent turbulence on the stock markets? Is this...

The ifo business climate survey for July not only puts a big question mark over hopes of an economic recovery in the second half of the year. There is now even the threat of a renewed slide into recession in industry. This has consequences for the investment strategy. Background: If business expectations in industry deteriorate three times in a row after a sustained upswing, this has often signalled a downward economic trend reversal in the past. In this case, the economic component of the private wealth stock market indicator consistently switches from "green" to "red". This is exactly what could happen at the end of August. The background: in the ifo Institute's monthly survey, participants have a choice of three possible answers: They...