The Dax index experienced a significant decline on Tuesday. At the close of Xetra trading, the index recorded 23,955 points, marking a loss of 1.6 percent compared to the previous day’s closing level.
According to Andreas Lipkow, Chief Market Analyst at CMC Markets, the day saw the continuation of an industry rotation within the Dax that had been noticeable over several trading days, largely keeping the index above the psychological barrier of 24,000 points during the day. However, falling prices in New York led to the index sliding below this critical threshold in the afternoon.
During market hours, stocks from companies with positive corporate news, such as Bayer, were particularly sought after. Conversely, shares experiencing losses were those where investors were taking profit from the weeks’ previous gains. Lipkow noted that the situation in the Middle East remains unresolved, meaning that any hopes for additional mediation efforts by other nations are still lingering.
Market attention today was drawn to both German consumer prices and the ZEW index. The analyst reported that while inflation in April matched expectations, the consensus economic forecasts available to analysts (-10.2 points) were slightly better than the anticipated -19.5 points, as seen on the ticker. He cautioned, however, that since the survey was conducted amidst expectations of a ceasefire between the US and Iran, these figures should be interpreted with caution.
Regarding the broader US economy, the released data painted a picture not of a dramatic collapse, but rather of a potential, gradual deterioration. Consumer prices rose in core rates in April by 2.8 percent, slightly exceeding the expected 2.7 percent, thereby reaffirming inflation pressures associated with the Iran conflict.
In other markets, the European common currency weakened by midday, with one Euro costing 1.1731 US dollars, and consequently, one dollar fetching 0.8524 Euros. Meanwhile, the price of oil rose sharply. By German time around five o’clock, a barrel of North Sea Brent oil cost $108.30, representing a 4.0 percent increase from the previous day’s close.
