FRANKFURT/PARIS (dpa-AFX) - Real estate stocks remain under pressure on Monday as hopes for further easing of US monetary policy fade. It has been clear for some time that the European Central Bank (ECB) is unlikely to cut interest rates any further for the time being. Low interest rates make real estate financing easier and therefore tend to be positive for the industry.
The European industry index fell by 0.3 percent, bucking the positive market trend. Vonovia came in last in the DAX with a loss of 1.2 percent, while TAG Immobilien and LEG Immobilien were among the weakest performers in the MDAX.
Market experts at Landesbank Helaba pointed out that the US Federal Reserve had moderately lowered its key interest rate for the second time in a row last Wednesday, but that Fed Chairman Jerome Powell had also emphasized that "a further cut at the December meeting is anything but certain." Analysts had previously assumed that there would be another cut at the end of the year.
The changed market expectations are also reflected in the CME Group's Fed Watch Tool. It shows the probability of future US interest rate changes based on the prices of Fed funds futures contracts. According to this, the probability of a further interest rate cut of 0.25 percentage points has fallen from 92 to 69 percent within a week./gl/mis
