The DAX began trading on Wednesday with gains. By 9:30 a.m., the leading index stood at approximately 25,335 points, marking a 0.6 percent increase from the previous day’s closing level. The top-performing companies were Adidas, Continental, and Daimler Truck, while RWE, Eon, and Deutsche Börse were among those that lagged.
Jochen Stanzl, Chief Market Analyst at Consorsbank, commented that growing hope for a peace deal in the Middle East conflict could prompt the DAX to attempt a breakout from its current year-long sideways range. He added that if indications of a peace deal involving Iran intensify, a new record high for the DAX may not be far off. Stanzl noted that international investors had previously shunned European stocks primarily due to the risk of rising energy costs, but this could change if the oil price sustainably falls below $100.
Stanzl further stated that geopolitical tensions have recently subsided to a level that allows investors to concentrate fully on the expansion of AI investments and the resulting growth. While the geopolitical risk premium is declining on one hand, interest in AI stocks does not appear to be saturated. Its momentum is described as “breathtaking”. He suggested that given the speed of the upward movement in AI stocks, new trillion-dollar companies are emerging rapidly, and multi-billion dollar valuations are being established quickly. According to the market expert, the temptation for investors to participate in this trend is too great to wait for a final resolution of the Iran conflict.
On a related note, the European common currency strengthened slightly on Wednesday morning, with the Euro trading at $1.1646, meaning the dollar was available for 0.8587 Euros. Separately, the oil price dropped. A barrel of North Sea Brent crude cost $97.17 around 9 a.m. German time, which was 241 cents, or 2.4 percent, less than the close of the previous trading day.
