The seismograph is a kind of weather forecast for the stock market. Using a complex mathematical model that includes both economic variables and direct market indicators, the model estimates the probability of three market conditions in the coming month. Green" means that a calm market with a positive trend is expected - investors can invest without hesitation. "Yellow" indicates a turbulent market with positive expectations - buying stocks is okay, but hedging is indicated. And "red" indicates a turbulent market with negative expectations. The advice is then: Do not invest.

The editorial team uses these results to determine the short-term equity positioning within the range suggested by the private-wealth stock market indicator.

The seismograph is a kind of weather forecast for the stock market. Using a complex mathematical model that includes both economic variables and direct market indicators, the model estimates the probability of three market conditions in the coming month. Green" means that a calm market with a positive trend is expected. "Yellow" indicates a turbulent market with positive expectations - investing is okay, but hedging is indicated. And "red" indicates a turbulent market with negative expectation. The advice is then: Do not invest.

Dear Readers,

In April, the ifo business climate index plunged to its lowest level ever measured. The fact that the current mood among German companies is catastrophic is not surprising given the global shutdowns. More critically, expectations for the coming six months have also continued to fall massively. In plain language, this means that even though the current situation is already extremely bleak, companies do not see any improvement even on a six-month horizon, but expect it to deteriorate further.

Short-time working allowance, tax liquidity support, financial assistance - the federal government or the EU not only provides money for entrepreneurs in need. An overall concept should prevent that actually healthy companies have to file for insolvency. Five points are particularly important here!

The Munich ifo Institute has now added to this. The coronavirus will cause hundreds of billions of euros in production losses for Germany's economy, cause short-time work and unemployment to skyrocket, and put a considerable strain on the national budget. "The costs will probably exceed everything known from economic crises or natural disasters in Germany in recent decades," said Ifo President Clemens Fuest. "Depending on the scenario, the economy will shrink by 7.2 to 20.6 percentage points. This corresponds to costs of 255 to 729 billion euros."