The DAX posted a solid gain at the start of the week. By the close of Xetra trading, the index stood at 22,562 points-a 1.2 % rise from the previous day.
Analyst Andreas Lipkow of CMC Markets said the DAX’s activity remains largely driven by Middle‑East developments. He noted that President Biden’s comments about progress in negotiations with Iran “brightened the mood” by reporting that 12 of 15 points in the demand list had already been successfully negotiated, according to the White House. However, he warned that the veracity and actual progress of those talks can’t be readily verified.
Overall, the market outlook remains challenging. It’s still unclear how much the rising energy prices will feed into inflation, and how high oil prices could climb. “One thing is certain: the devastated infrastructure in the Middle East will very likely prevent a rapid deflationary trend” Lipkow added.
Inflation in Germany returned to 2.7 % in March. With the sharp increase in energy costs, consumer prices could have spiked beyond three percent. April will test whether those price‑suppression effects hold. The risk of an inflation shock cannot be dismissed, especially given parallels to the post‑war period after the conflict in Ukraine.
Currently, a relatively low trading volume is helping the DAX, easing selling pressure. Nevertheless, it’s too early to feel reassured. Lipkow cautioned that should U.S. ground forces be deployed to the Iran war, a new chapter would likely begin.
The euro weakened on Wednesday afternoon; one euro was worth 1.1456 U.S. dollars and one dollar traded at 0.8729 euros. Gold benefited, with a fine ounce priced at $4,551-or €127.71 per gram-up 1.3 % in the afternoon. Brent crude fell slightly, trading around $112.50 per barrel (about 3 cents, or 0.0 % lower than the previous day’s close) at 5:00 p.m. German time.
