Historic Record Above 26,500 Points: Oman Diplomacy Drives Down Oil Prices and Propels the DAX!
The German benchmark index continues its march from record to record. On Tuesday, the DAX catapulted above the magic 26,500-point mark for the first time in its history, closing the trading session up 0.24 percent at 26,391.42 points. The primary fuel for this undiminished record chase remains another drop in oil prices. Markets are increasingly pricing in a viable diplomatic solution to the Iran conflict. Signal relief is currently coming from Oman: The Sultanate is reportedly close to an agreement with Tehran—likely without direct US involvement—to secure free navigation through the strategically essential Strait of Hormuz.
Comparatively Attractive: How Long Can DAX Corporations Defy High Energy Costs?
Fundamentally, the DAX remains on a remarkably solid footing. Compared to the often ambitious valuations on US tech exchanges, German blue chips appear by no means overheated. The recent earnings season also highlights the astonishing resilience of companies that, despite ongoing cost pressures on the energy side, continue to deliver robust results for now. Nevertheless, the fundamental question remains open for market analysts: How long can domestic industry compensate for these elevated energy prices without noticeable margin hits or passing them on to end consumers?
US Inflation Data in Focus: CME FedWatch Signals an Overdue Breather!
For today, Wednesday, the collective focus of global financial markets turns to the upcoming consumer price figures from the US. Statistically, Wednesday often marks the peak of the week before the market locks in profits. Inflation data acts as the ultimate tipping point: Will inflation show its teeth again, or will data confirm the hoped-for decline? The stakes are extremely high, as the CME FedWatch Tool is currently pricing in a roughly 50 percent probability of a US interest rate hike in September. The central question therefore is: Does the DAX have the momentum for a sustained breakout above 26,500 points, or will the inflation report force the benchmark index into an overdue consolidation?
The information provided does not constitute investment research. The material has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and as such is to be considered to be a marketing communication.
All information has been prepared by ActivTrades (“AT”). The information does not contain a record of AT’s prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.
Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not a reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acting on the information provided does so at their own risk. Forecasts are not guarantees. Rates may change. Political risk is unpredictable. Central bank actions may vary. Platforms’ tools do not guarantee success.