While U.S. markets continued to rise on Tuesday, the DAX was punished by investors, closing the trading day down almost 1%. The index finished significantly below 24,000 points at 23,673.29, a sign that casts doubt on the promised summer rally in the German stock market.
Is it truly just the lack of a resolution in the tariff dispute weighing on the DAX? Or is Germany's domestic political development playing an increasingly significant role? Concerns are growing that a political force once known as a "people's party" is shifting further left, potentially abandoning its economically promising path. This creates uncertainty and erodes investor confidence in the stock market.
Adidas Defies the Trend
Despite the overall negative sentiment in the German stock market, Tuesday also saw clear winners who bucked the downward trend. Leading the pack was Adidas stock, which gained an impressive 4.2 percent. Closely following was Zalando with a daily gain of 4 percent. Bayer stock took third place with a daily gain of 3.6 percent.
Warning Signs for Traders: Is Trouble Brewing for the DAX?
Technical traders are now becoming particularly cautious. A volatile picture is emerging on the DAX's daily chart: Monday's daily lows couldn't be held, and the DAX was sold off throughout the entire day – even as American markets rose. This constellation is extremely dangerous for the DAX. Should U.S. labor market data turn out weaker than market expectations, it could plunge the German leading index into serious trouble.
Gold Shines Again: Capital Flight in Uncertain Times?
At the same time, the price of gold is also staging an impressive rally once more. The precious metal rose again to almost 3,340 US dollars and could soon target new all-time highs. This suggests that capital is being moved to safety. But what exactly is it that's currently unsettling the markets?
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