The DAX Maintains Its Recovery Gains
The DAX is currently stable and able to maintain its recovery gains, indicating a positive market sentiment. This development is particularly remarkable given that the DAX is back on a recovery path after a turbulent April month characterized by an interim loss of nearly 17 percent. The decline was primarily due to the tariff conflict triggered by the USA, which began in early April. After dipping to a low of 18,489 points, the DAX recovered by more than 20 percent and is now only about one percent below the level prior to the tariff announcement by Donald Trump.
Background of the Recovery
- Tariff Conflict and Recovery: The DAX suffered from the effects of the tariff conflict initiated by an announcement from Donald Trump. This announcement led to significant losses, but after a preliminary turnaround in the tariff dispute, the DAX began a recovery rally.
- Market Sentiment and Forecasts: The current stability of the DAX and its ability to maintain recovery gains suggest a positive market sentiment. Investment strategists like Mislav Matejka from JPMorgan see the prospects of international stock markets as more attractive compared to the USA, especially if the news around tariffs continues to improve.
- Technical Analysis: The DAX is approaching the 50-day moving average, which is an important technical indicator for short-term market direction. A break through this line could support further upward trends.
Outlook
- Economic Factors: The further development of the DAX will be strongly influenced by economic factors such as tariff policy and global economic prospects. An improvement in trade relations could further strengthen the DAX.
- Recession Concerns: Despite the current recovery, recession concerns still exist that could impact the markets. However, international stock markets might be less affected by these concerns than the US markets.
Overall, the DAX demonstrates a robust recovery capability supported by positive market sentiment and improved economic conditions.