Drivers of Market Optimism
- De-escalation in the Trade Dispute: Willingness to negotiate between the USA and China makes investors hopeful for a relaxation of tariff conflicts. China’s recent signals of willingness to talk have been viewed as a turning point.
- Expectations of Interest Rate Cuts: Hope for imminent rate reductions by the US Federal Reserve supports risk appetite, even though current inflation data does not clearly indicate a direction.
- Technical Recovery: The DAX closed a 4,000-point gap since the April low within weeks, approaching the February high at 22,935 points.
Economic Headwinds
- US GDP Decline: The gross domestic product of the USA shrank by 0.3% in the first quarter of 2025, the first decline in three years, driven by trade deficits ahead of new tariffs.
- Labor Market Dynamics vs. Inflation: A robust US labor market stands in contrast to subdued consumer behavior and import pressure.
Investor-Relevant Developments
| Factor | Effect |
|---|---|
| Technical Chart Patterns | DAX shows V-shaped recovery with price target of February high |
| Sector Rotation | Tech stocks and cryptocurrency markets benefit from risk appetite |
| Seasonality | Historically positive May performance supports psychology |
The current optimism primarily stems from expectations of future political decisions – a classic “Hope Trade”. For investors, it remains crucial to observe two key signals: a stabilization of the earnings yield spread and a decrease in volatility in high-yield bonds. As long as these indicators do not provide a clear trend confirmation, caution is warranted for long-term positioning.