DAX Breathing Room: Just a Brief Respite or a Real Turnaround?
After the brutal sell-off at the beginning of the week, the DAX finally managed to pull the emergency brake this past Wednesday. With a strong gain of 1.74%, the leading index rescued itself back above the 24,000 mark, ending the session at 24,205 points. For market participants, this provided a first moment to breathe, even if it only partially mitigated the massive losses incurred on Monday and Tuesday.
The world remains in a difficult phase of discovery following the outbreak of war involving Iran. Investors are desperately trying to gauge how much further the escalatory spiral might turn. Meanwhile, the US government maintains its combative stance, emphasizing that Iran is already militarily weakened and that operations are "ahead of schedule." Hope flickered when Washington announced plans to provide naval escorts for tankers in the Strait of Hormuz. Combined with Donald Trump’s promise to deliver "the lowest oil prices in history," this provided enough relief to lure buyers back to the market.
Earnings Check: Adidas, Continental, and Bayer Disappoint Across the Board
While geopolitics provided a tailwind, the fundamental side offered mostly headwinds. The financial results presented yesterday by DAX giants were anything but a cause for celebration:
Adidas: The sporting goods giant significantly disappointed with its 2026 margin outlook. The penalty was swift, with the stock plunging over 5% at its intraday low.
Bayer: Another billion-dollar loss and a cautious outlook weighed heavily on investor sentiment.
Continental: Revenue and margins also fell short of expectations, dragging the stock into the red at times.
Labor Market and ECB: The Next Impulses are Lined Up
Today, Thursday, the focus shifts back to the United States. At 2:30 PM CET, the Initial Jobless Claims will be released. In the current market climate, every fragment of US economic data is being scrutinized. Additionally, interviews with ECB members during the ongoing ministerial meetings could spark movement, as policymakers must now show their hand on how they intend to react to the inflation-driven oil price rally.
Technical Summary: Caution Remains the Top Priority
Technically, yesterday’s recovery is welcome, but it is far from an "all-clear" signal. We are looking at a classic technical bounce within a very fragile environment. As long as the DAX does not sustainably break above the 24,500-point zone, the danger of further setbacks—fueled by new headlines from the Middle East—remains omnipresent. The bears are still lurking in the shadows.
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