Short Circuit in the DAX: Index Plummets – Does the Year-End Rally End Prematurely?
Thursday was a shock for the German stock market: the DAX took a sharp hit, dragged down by weakening US markets. The end of the trading day saw a bitter loss of 1.31 percent, with the index closing at 23,734.02 points. Reclaiming the 24,000-mark will now be an arduous task. Should panic spread across the stock markets and the sell-off accelerate, this could mean a premature end to the year-end rally. If this volatile course continues today, Friday, investors face an unpleasant trading day, possibly signaling difficult trading weeks ahead until the year's end.
DHL Defies the Market – SAP Caught in Tech Correction
The divergence among individual stocks was immense. DAX heavyweight SAP was caught in the wake of weak US technology stocks, incurring a significant loss of 4.4 percent. Even weaker was Heidelberg Materials, which marked the bottom of the DAX list with a drop of 4.9 percent. Undeterred by the losers, DHL stock showed its positive side. A daily gain of 8.6 percent made DHL the clear day's winner after the company presented unexpected profit growth and confirmed its targets.
DAX in Freefall: Next Support at 23,300 Points
From a technical chart perspective, the DAX appears to have definitively started an downward trend. Thursday's massive selling occurred precisely at the 100-day moving average, which was confirmed as resistance. The next critical support is now the intraday low from Wednesday. Should this fail to hold, an accelerated sell-off to 23,300 points is conceivable. This level holds support that successfully held multiple times in October. The DAX is gradually disappearing into a downtrend, and investors must prepare for high volatility.
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