The Dax index continued its downward trend on Monday, moving through losses even after a weak start to the trading day. Around 12:30 PM, the leading index was reported at approximately 24,370 points, marking a 1.3 percent drop from the previous day’s closing level. The top names on the stock list included RWE, Deutsche Börse, and Commerzbank, while SAP, MTU, and Volkswagen were among the last performers.
Andreas Lipkow, Chief Market Analyst at CMC Markets, stated that investor uncertainty returned over the weekend, dampening the hopes generated on Friday afternoon. He added that the significant rise in oil prices is causing concern for investors. He noted that the impact of oil prices on inflation rates and consumer spending will depend not on whether a barrel costs more or less than 100 US dollars, but rather on the overall trend and how long the elevated price level persists.
Lipkow also commented that the situation in the Middle East has worsened, and the longevity of news from the region is becoming shorter. He observed that with each setback in negotiations between the warring parties, the drive for new solutions dwindles, consequently reducing investors’ motivation to buy stocks. He suggested that the current truce is only nominal, as the numerous small volatile spots in the region and Iran cannot be fully contained or dampened.
According to the market expert, the coming weeks are expected to remain volatile and full of surprises. This, combined with the ongoing earnings season, could create an explosive mix for the financial markets. Lipkow pointed to Netflix’s quarterly figures as a recent illustration; he warned that those who become overly optimistic could face a sharp downturn.
In other developments, the European common currency strengthened by Monday afternoon, with the Euro trading at 1.1767 US dollars, making the dollar worth 0.8498 Euros. Concurrently, oil prices rose. A barrel of Brent crude oil in the North Sea cost 94.55 US dollars around noon German time on Monday afternoon, representing a 4.6 percent increase compared to the previous day’s close.