The DAX remained in negative territory on Tuesday, continuing a weak start throughout the day. By 12:30 PM, the index had been calculated at approximately 25,830 points, marking a decrease of 0.6 percent compared to the previous trading day. Bayer, FMC, and RWE led the rising stocks, while MTU, SAP, and Zalando finished the day in the red.
At midday, the DAX barely moved above its opening level. Andreas Lipkow, Chief Market Analyst at CMC Markets, noted that while Bayer provided some optimism, the trend in profit margins at Zalando remains a key drag on its performance.
Recent results from Bayer were generally well-received by the market, prompting renewed hopes for a sustainable improvement in the company’s business outlook. According to Lipkow, a potential resolution to the glyphosate lawsuits in the US could serve as a major relief for the conglomerate.
In contrast, Zalando illustrates that even strong consumer demand does not automatically translate into higher profits. Increased costs and pressure on gross margins are eroding profitability. Despite this, the stock can recover from its initial losses, making progress toward the profit zone after previously being among the lowest-ranking on the DAX.
Lipkow added that the company’s situation is being overshadowed by the mid-term elections unfolding in the US. These elections could significantly alter the balance of political power in Congress, thereby limiting the economic policy options available to the administration. Since a changed distribution of power could profoundly influence future tax, trade, and budgetary policies, much is at stake for financial markets. Consequently, investor willingness to take on major risks is currently low.
Separately, the European community currency weakened slightly during Tuesday’s lunch hours: one Euro was trading at $1.1178, and the Dollar was priced at 0.8946 Euros. Meanwhile, the price of oil rose. Around noon German time, a barrel of North Sea Brent crude cost $106.20, representing a 1.3 percent increase over the final trading price of the previous day.
