On Friday, May 23, 2025, the DAX experienced a significant crash after U.S. President Donald Trump made a drastic announcement. Trump announced a flat tariff of 50 percent on all EU imports that are not produced directly in the U.S., effective June 1.
Crash of the DAX
The market’s reaction was quick to follow. The DAX fell by about 2 to 3 percent, corresponding to a decline of over 700 points. This drop in value from a daily high near 24,150 points to about 23,275 to 23,355 points highlights the sensitivity of the market to political tensions.
Trump’s Justification
Trump justified his decision by citing “powerful trade barriers” and “absurd corporate penalties” that were supposedly giving advantages to the EU. He even went so far as to claim that the EU was founded to exploit the U.S. in trade.
Impact on Investors
For investors, this conflict poses an increasing risk. Particularly, German companies with high export volumes to the U.S. could be severely affected. The uncertainty in the transatlantic trade conflict negatively influences market sentiment and unsettles investors.
In summary, Trump’s statements put considerable pressure on the DAX, and the geopolitical tensions were a decisive factor in the decline.