The German DAX index commenced trading on Tuesday with losses, reflecting a period of cautious investor sentiment. By 9:30 AM local time, the benchmark index was calculated at approximately 24,205 points, representing a decrease of 0.4 percent compared to the previous day’s closing level.
FMC, Daimler Truck and Fresenius led the list of gainers, while Sartorius, Infineon and Merck experienced the largest declines.
Jochen Stanzl, Chief Market Analyst at CMC Markets, attributed the subdued performance to a combination of factors. “As the earnings season begins and customs-related uncertainty compels investors to adopt a wait-and-see approach, there’s a palpable sense of summer calm on the Frankfurt trading floor” he stated. He noted a decrease in market volatility, while acknowledging that the risks associated with ongoing trade disputes with the United States remain elevated.
Stanzl further explained that investors are maintaining a vigilant stance, prepared to react swiftly if necessary. “Many have likely secured their positions with stop-loss orders positioned below 24,150 and subsequently below 23,900 points” he observed, suggesting a potential for automated sell-offs if those levels are breached. The release of quarterly earnings figures, for example, expected from DAX heavyweight SAP later in the day, will likely test the willingness of investors to capitalize on potential bargain-hunting opportunities.
The Euro weakened slightly against the US dollar, trading at $1.1687, equivalent to €0.8557 per dollar.
Meanwhile, oil prices also decreased. Brent crude, a benchmark for the North Sea, traded at $68.78 per barrel around 9:00 AM local time, a drop of 43 cents, or 0.6 percent, from the previous day’s closing price.