The DAX remained in negative territory throughout the day on Thursday, continuing a weak start into the midday session. Around 12:30 PM, the leading index was calculated at approximately 23,800 points, which represented a 1.2 percent drop compared to the closing level of the previous trading day. Leading the performance list were BASF, the Deutsche Börse, and Brenntag, while the top performers were SAP, Rheinmetall, and Gea.
According to Andreas Lipkow, Chief Market Analyst at CMC Markets, investors in Frankfurt continue to react very sensitively to the political and military developments occurring in the Middle East. He noted that the ongoing attacks have led to rising energy prices in the financial markets, with Brent crude oil rebounding above $100 per barrel. Concerns persist regarding potentially high inflation rates and the subsequent need for tighter monetary policies from central banks.
Lipkow also pointed out that technology stocks in the DAX 40, particularly SAP and Infineon, are under selling pressure today. Additionally, shares of car manufacturers are once again among the losers. Although the gains from the previous day have not been entirely depleted, the risk of more significant price declines in the coming trading days remains present. He suggested that such a development could constitute a classic bull trap, resulting in a steeper subsequent correction. Furthermore, he warned that the buying frenzy observed on Wednesday could potentially unravel into a selling panic, putting strong downward pressure on the DAX.
Meanwhile, the common European currency strengthened slightly by midday on Thursday. The euro cost $1.1677, and consequently, one dollar was available for 0.8564 euros.
In parallel, oil prices saw another increase. The Brent crude type from the North Sea cost $98.40 per barrel around noon German time, marking a 3.9 percent increase over the close of the previous trading day.