At the end of the week, the Dax made significant gains. At the Xetra closing, the index was calculated at 23,087 points, representing a 2.6% increase compared to the previous day’s close. After a stable start in the morning, the Dax continued to rise throughout the day and reached a higher level in the late afternoon.
Jochen Stanzl, Chief Market Analyst at CMC Markets, commented, “The Dax has jumped above the 23,000-point mark, recapturing the fourth thousand in just three weeks after the near 18,500-point low, taking a significant step towards a record high. The recently released US employment data for April, with 177,000 new jobs created, alleviates immediate recession concerns to some extent. The financial market, labor market and companies are showing resilience against uncertainty in trade policy. This is a positive sign.”
However, Stanzl also noted that with these strong data, the chances of the US Federal Reserve taking decisive action would decrease. “The strong data suggest a Fed that will continue to be cautious in the coming months. If now, after only a brief period of frostiness in Sino-American relations, the US economy shows no signs of recession despite Trump’s trade chaos, it could still escape with minor damage.”
Analysts explained that concerns over European economic growth, weaker business surveys and a strong euro had raised expectations for further interest rate cuts by the European Central Bank. “Today’s inflation data could now put an end to those expectations. The money markets were expecting a total of 67 additional basis points of easing this year.” However, as inflation proved more persistent than expected, the prospects for a further interest rate cut in September after the anticipated quarter-point reduction in June would decline.
Siemens Energy shares were at the top of the list in Frankfurt, with only a few Dax stocks moving against the trend in the negative direction. Munich Re and RWE shares suffered the steepest declines.
Meanwhile, the gas price increased: A megawatt hour (MWh) of gas for delivery in June cost 33 euros, which is a 3% increase from the previous day. This implies a consumer price of at least approximately 8 to 10 cents per kilowatt hour (kWh), including additional costs and taxes, should the price level persist.
The oil price, on the other hand, decreased significantly: A barrel of North Sea Brent crude oil on Friday afternoon was priced at 61.46 US dollars, which was 67 cents or 1.1% lower than the closing price of the previous trading day.
The European community currency was stronger on the Friday afternoon, with one euro costing 1.1350 US dollars and one dollar equivalent to 0.8811 euros.