The German DAX continued to fall throughout the morning after a very weak start, but the losses narrowed as the day progressed. By about 12:30 GMT the index sat at 23,190 points, roughly 1.7 percent below the previous day’s closing level. On the top of the list of gains were Rheinmetall, Hannover Re and the Deutsche Börse, while the worst performers were Siemens Energy, MTU and Continental.
CMC Markets’ chief market analyst Andreas Lipkow said the DAX could rebound above the 23,000‑point mark within the first two trading hours. The intraday trough at 22,920 points had not unduly frightened investors and was instead taken as a buying opportunity for German blue‑chip names.
Lipkow added that the extreme pessimism seen in the futures market points to heavy hedging activity. These hedges tend to blunt broader market falls and help keep the DAX anchored around the 23,000‑point zone. However, the long‑term effects on the real economy will not yet be fully reflected and will only become evident in coming quarters. Investors currently rely on the hope that energy prices will ease in the coming days; should they remain at their current levels, the result could be adverse for economic growth.
At mid‑afternoon the euro was stronger: 1 EUR equalled 1.1566 USD, while 1 USD was worth 0.8646 EUR.
Meanwhile, crude oil prices were on the rise. At 12:00 CET a barrel of Brent North Sea oil was trading at $104.60, a gain of 12.8 percent over the previous day’s close.