DAX in Freefall? Five Red Days in a Row Fuel Market Fear!
Market uncertainty is palpable: The German stock index (DAX) has recorded five consecutive losing trading days. July's positive balance is now at risk, and August – traditionally a weak month for the stock market – is just around the corner.
In addition, the European Union is increasingly preparing for the US President to be serious about the new import tariffs this time, with no further postponements. Regardless of countermeasures, this would hit Europe at a particularly inopportune time. For example, ASML recently presented a top quarterly report, but its outlook is concerning. The manufacturer of semiconductor production equipment sees no growth confirmed for 2026. Economic conditions and geopolitical developments are cited as reasons for the currently bleak outlook. As the stock market notoriously prices in the future, it's almost certain that the DAX's recent all-time high may have been its last for a longer period.
Trump vs. Powell: Political Turmoil Shakes the Markets
Donald Trump's renewed attempt to initiate a process to remove incumbent Federal Reserve Chairman Jerome Powell from office also caused sharp short-term movements. Such political interventions can further weigh on market sentiment and lead to volatility.
Among individual stocks, Munich Re was the day's winner with a 1.8 percent gain, closely followed by Bayer. Bayer's shares rose by 0.9 percent, continuing their efforts to break above the 28 euro mark. Volkswagen was the day's biggest loser, closing with a 3.9 percent decline.
DAX on the Brink? The Critical 24,000-Point Mark Is Wavering!
The DAX has so far managed to defend the psychologically important 24,000-point mark. The recent sell-off is partly attributable to the political headlines surrounding Donald Trump and Jerome Powell. A positive impulse would, of course, be a breakthrough in trade negotiations between the EU and the USA. However, investors must prepare for the possibility that the 24,000-point mark could be breached in the coming trading periods, which would lead to further price declines.
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