The DAX has stabilized and made significant gains following Donald Trump’s recent statements. This development is of particular interest to investors as it reflects potential future market developments. Here are the key factors that have contributed to this stabilization:
Main Factors for DAX Stabilization
- SAP Quarterly Results: SAP has presented convincing quarterly results that exceed both profit and operating margin expectations. This has convinced investors and increased the SAP stock by 8.4%. As SAP has the largest weight in the DAX, it pulls the index up.
- Trump’s Statements on China and the Fed: Donald Trump has changed his stance on China and the Federal Reserve (Fed). He announced that he would be “very nice” in trade talks with China and reduce tariffs, although not to zero. Moreover, he has retracted his threats against Fed Chairman Jerome Powell, leading to a relaxation in the markets.
- Market Reactions: Trump’s positive statements have led to a recovery in the markets after his previous threats had caused uncertainty and flight movements into European bonds and stocks. The DAX has thus partially offset its losses from previous weeks and is now back at the level of April 3.
Outlook and Risks
- Downward Risks: Despite the current recovery, downward risks remain. A single social media post from Trump could nullify the recovery at any time. The markets are still susceptible to Trump’s unpredictable statements.
- Future Developments: The stabilization of the DAX might be a sign of an improved market situation, but it is too early to speak of new all-time highs. Uncertainty remains high, and investors should prepare for possible fluctuations.
Overall, it is evident that the recent developments in the DAX are heavily influenced by political factors, particularly by Donald Trump’s statements. Investors should prepare for continued volatile markets.