FRANKFURT (dpa-AFX) – After the early Christmas present from the US Federal Reserve with another rate cut, investors are hoping for a continuation of the recent stock market rally in the final full trading week before Christmas. This could turn what has already been a strong December into the much-discussed "year-end rally," provided there are no major disruptions. Such disturbances could come from US economic data.

According to market observer Jürgen Molnar from broker Robomarkets, the DAX remains "exactly on track" with its recent gains, as December is typically a strong month for the stock market. So far this month, the German blue-chip index has gained "only" two percent. From the November low just below 23,000 points, the increase grows to a solid six percent.

With New York's Dow Jones Industrial already posting its next record high, attention in Germany is now focused on the DAX's previous all-time high of 24,771 points. Molnar sees the last significant hurdle on the way there at around 24,500 points. From there, the round 25,000 mark is not far off.

According to Commerzbank, the Fed has recently been the decisive driver for the markets for three reasons: In addition to the rate cut, analyst Andreas Hürkamp pointed to the decision to buy short-term bonds and an upgraded forecast for US economic growth. He expects further economic data in the coming week to confirm his optimistic outlook for the US economy.

Investors are eagerly awaiting the US jobs report on Tuesday, which will include not only the November figures but also employment data for October. This will help resolve the backlog of key economic data that had built up after weeks of government shutdown. The Fed weighs the job market against inflation as its second criterion, and fresh inflation data for November is expected on Thursday.

Against the backdrop of labor market and inflation influences, as well as some missing data, the Fed found itself in a dilemma. Deka Bank's chief economist Ulrich Kater spoke of a compromise the Fed had to make recently. At a time when, among other things, US tariffs are creating inflationary risks, the US labor market has recently shown signs of weakness. Kater believes the Fed has succeeded in maintaining market participants' confidence in its actions.

The Fed has already made its decision for December. However, Thursday will be interesting with interest rate decisions from the European Central Bank (ECB) and the Bank of England. No further rate cuts are expected from the ECB anytime soon.

Before investors gradually close their books for the year, the final trading note before Christmas next Friday could be shaped by the "triple witching" expiration on the derivatives exchanges. On these days, options on the derivatives exchanges expire. Uncontrolled price swings are not uncommon, as large market participants often try to move prices in a direction advantageous to them.

As for German companies, the figures presented by Nike and FedEx after the US market closes on Thursday could influence the shares of German competitors such as Adidas, Puma, or DHL at the end of the week. In Germany, there are a few latecomers to the earnings season, with Ceconomy and Thyssenkrupp Nucera reporting on Wednesday and Douglas on Thursday./tih/mis/jha/

--- By Timo Hausdorf, dpa-AFX ---