Financial Markets Experience Volatility as Investors Reassess Risks
The German Dax index continued its decline on Thursday, with the benchmark index closing in the red for the second consecutive day. By 12:30 pm, the Dax had slipped to around 23,640 points, a 1.3 percent drop from the previous day’s close.
Market analysts are now warning of a potential correction, citing the accumulation of risks and negative news in recent weeks. “The market has been ignoring the growing number of crisis hotspots and it’s only a matter of time before the bubble bursts” said Andreas Lipkow, a market analyst.
The ongoing trade tensions, particularly the stalemate in the US-China trade talks, are a major concern, as are the escalating tensions in the Middle East, which are already affecting oil prices. The European debt crisis, with its focus on excessive borrowing, is also seen as a potential threat to the global economy.
In the United States, the debate over government debt and internal political tensions is dominating the market’s attention, making it challenging for the Dax to regain the 24,000-point mark, according to Lipkow.
Meanwhile, the euro strengthened on Thursday, with one euro equivalent to 1.1577 US dollars and the dollar to 0.8638 euros. The Brent crude oil price, however, fell sharply, dropping 1.4 percent to 68.80 US dollars per barrel by 12 pm German time.