DAX Index Recovers as Trade War Fears Fade

Colin First

Updated Thu, Apr 5, 2018, 1:11 AM

DAX Recovers Strongly

The DAX begun the day yesterday on the backfoot as the fears over a global trade war breaking out became worse with China choosing to retaliate and they also imposed larger tariffs. This led to great fear and with Trump also choosing to launch a tirade against Amazon, the stock indices in the US fell on the previous day and this carried on into the other global markets yesterday.

That is why the DAX fell hard during the opening yesterday and for a brief while it looked as though the index would be breaking through the lows of the range and if that had happened, then all hell would have broken loose. But as the day progressed, there was better news from the US as reports said that the tariffs are still in discussion stage and this led to a belief that they might get diluted which helped the index to recover.

Looking ahead to the rest of the day, we do not have any major news from Germany or the Eurozone and hence we can safely say that the recovery and the rebound is likely to continue, especially due to the fact that the stock indices in the US closed strongly during the course of the day yesterday. The effect of this is likely to rub off on the other major indices but with the fears and the risks continuing to run underneath, we do not expect any major bullish leg in the near future.

This article was originally posted on FX Empire