The DAX experienced a decline on Thursday, closing the Xetra trading session at 25,092 points, representing a decrease of 0.3 percent compared to the previous day’s close. After starting the day in the red, the index continued to lose ground, although it managed to briefly turn positive during the afternoon.
Andreas Lipkow, Chief Market Analyst at CMC Markets, noted that the brief surge in the DAX, which was fueled by the slowly emerging news of an imminent deal between the US and Iran, was not sustainable. “How many times has a compromise been promised, and how many times have investors been disappointed?” he stated. “One can only contemplate a repositioning in the stock market after the signature is dry”.
The expert explained that investors remain cautious regarding the Middle East situation and continue to anticipate a positive negotiation outcome despite renewed attacks. However, this cautious stance is thinning trading volume and dampening price volatility. Lipkow observed that indications of profit-taking are appearing in specific sectors and industries, with those funds being partially reinvested in other areas.
Currently, industry rotation is keeping the DAX stable, though hovering above the 25,000 mark. The analyst remarked that defense stocks, which faced significant headwinds recently due to growing hopes of peace, were sought after today. Rheinmetall and Infineon led the price list in Frankfurt just before the market closed, while Siemens Energy shares occupied the last spot.
Meanwhile, energy prices were on the rise. The price for one megawatt-hour (MWh) of gas delivered in June reached 47 euros, an increase of 3 percent from the day before. If this price level remains stable, this implies a consumer price of approximately nine to eleven cents per kilowatt-hour (kWh), including taxes and ancillary costs.
Oil prices also climbed. A barrel of North Sea Brent crude cost $94.95 on Thursday afternoon, around 5 PM German time, an increase of 66 cents, or 0.7 percent, over the previous closing price.
Finally, the European community currency strengthened on Thursday afternoon. The Euro traded at $1.1656, meaning the Dollar was priced at 0.8579 Euros.
