Financial Markets Show Little Movement at the Start of the Trading Week
The Frankfurt Stock Exchange opened on Tuesday with only minor changes in stock prices. By 9:30 am, the Dax index had been calculated at around 24,160 points, a decline of 0.1 percent compared to the previous trading day’s close. Eon, Qiagen and Deutsche Post led the list of gainers, while Rheinmetall, Commerzbank and Siemens Energy trailed behind.
According to Jochen Stanzl, chief market analyst at CMC Markets, the current trading week is dominated by the ongoing trade negotiations between China and the United States. “It seems that President Trump’s meeting with Xi has given the talks a new impetus” he said, adding that the motivation for a deal is palpable on both sides, but it is still unclear if the parties can agree on the details in the near future.
The potential for a breakthrough in the trade talks is not limited to the United States, as a handshake in London could trigger a surge in the stock market on Wall Street, which is still only about 2 percent away from its record high.
In Frankfurt, investors are seeking concrete reasons to drive the Dax’s 28 percent rally even higher. “A deal between China and the United States would certainly be an argument” Stanzl said.
Most investors have adapted to the situation, in which the US economy may slow down in the coming months but a recession is not expected, Stanzl added. This can be seen in the expectations for the Federal Reserve’s interest rate cuts, which are scheduled for September, December and March 2026.
Only investors who do not expect a recession or other disruptions in the US economy can expect a gentle interest rate path.
The euro was weaker on Tuesday morning, with one euro exchanging for 1.1392 US dollars and one dollar for 0.8778 euros.
Meanwhile, the oil price rose slightly, with a barrel of Brent crude costing around 67.14 US dollars at 9 am German time, an increase of 10 cents or 0.2 percent from the previous trading day’s close.