German equities continued a downward trend on Wednesday, remaining in negative territory following a weak opening. Around midday, the leading DAX index was recorded at approximately 23,590 points, representing a slight decrease of 0.1 percent compared to the previous day’s closing level. Siemens Energy, Rheinmetall and Zalando led the top performers, while Continental, Merck and Brenntag experienced the steepest declines.
The Ifo business climate index, released in the morning, revealed a weaker-than-anticipated outcome. Thomas Gitzel, Chief Economist at VP Bank Group, commented on the data, describing it as “a sobering reality check” and indicating that a cyclical recovery remains elusive. He emphasized concerns surrounding escalating trade conflicts and geopolitical uncertainties, which are putting pressure on Germany’s export sector. Furthermore, the anticipated impact of the government’s infrastructure investment program is failing to gain traction.
Gitzel expressed growing disappointment surrounding the infrastructure fund, initially intended to bolster the struggling economy. He cautioned that it could be some time before tangible positive effects are observed and questioned whether these effects will significantly influence the economic outlook in the coming year. He further noted that faster permitting processes would be essential to realize the intended benefits.
The euro weakened during midday trading, fluctuating to 1.1758 US dollars, making the dollar equivalent to 0.8505 euros.
Meanwhile, crude oil prices saw an increase. Brent North Sea crude was trading at $68.23 per barrel around noon, a rise of 60 cents or 0.9 percent compared to the closing price of the previous trading day.
