The Dax opened this week with a substantial retreat, closing at 24,638 points – a fall of 2.6 % compared with the previous trading day.
Andreas Lipkow, chief market analyst at CMC Markets, said that despite the sharp drop shown on the Frankfurt display board, the overall reaction in financial markets to the escalating Middle‑East conflict has been rather moderate. He noted that if the surge in energy prices had pushed even higher, the global price swings could have been more severe. Investors are now closely watching how long the elevated oil price will persist and how the Euro/US dollar pair develops, as these factors will influence market sentiment across the globe.
Lipkow added that President Trump currently estimates the military conflict could last between four and five weeks – a duration, he argued, that Europe could absorb without severe damage. Brent crude priced between $80 and $85 a barrel is unlikely to create major upheavals. It would be only if prices climbed above $100 and stayed there for several months that Europe would feel a genuine adverse impact on its economic outlook.
In Asia, Japan and China depend heavily on external oil supplies. A prolonged disruption in supply chains would dampen global economic growth and reignite inflationary pressures. By contrast, U.S. companies are less directly exposed to the Middle‑East flare‑up. Because of the shale boom, the United States has become a net exporter of oil products, giving its economy a very different footing from Europe and China. This divergence allows Wall Street to recover most of the pre‑market losses later in the day.
Lipkow also warned that classic crisis‑market reactions remain evident, and that the changing situation in the Middle East must be monitored carefully. “The diplomatic stances of Russia and China are crucial factors here” he said.
On the currency front, the euro weakened on Wednesday afternoon: one euro fetched $1.1677, while one dollar was worth €0.8564.
Gold saw a modest gain, trading at $5,307 per fine ounce – a rise of 0.6 %. This translates to about €146.11 per gram.
Meanwhile, the price of Brent crude had jumped sharply: at 5 p.m. German time Wednesday, it was $77.98 a barrel, up 7.0 % from the close the previous day.