The German stock index (DAX) has started the week on a sour note, closing lower on both Monday and Tuesday. This marks four consecutive red days, a streak last seen in early June, which then led to a nearly 6 percent correction. While we're not quite there yet, this clearly highlights the remaining downside potential for the German equity index. Investors will be nervously watching the 24,000-point mark in the coming trading days. The DAX closed at 24,060.29 points yesterday, down 0.42 percent.
Tariff Stalemate: US-EU Deadlock Paralyzes the Market
Unfortunately, there are currently no surprisingly positive developments to propel the market forward. The tariff negotiations between the US and the EU are proving tougher than ever. While the EU is already threatening retaliatory tariffs if US measures are implemented, the official focus remains on a negotiated solution. However, neither party seems truly willing to compromise, which is keeping market uncertainty high. This lack of clarity is blocking positive impulses and fueling nervousness.
Despite the generally gloomy mood, there were some bright spots: Brenntag, BMW, and Daimler managed to end the negative trading day in positive territory. Brenntag's shares rose by 2.8 percent, followed by BMW with a 1.9 percent gain. Daimler rounded out the winners' list with a 1.5 percent price increase.
DAX at a Crossroads: Will 24,000 Hold, or Is a Plunge Imminent?
Technically, the DAX is currently difficult to assess. Monday's low was not breached on Tuesday, and this low found support at a recent interim high. If this continues to act as support, there's a chance the DAX can hold above 24,000 points. However, this position is precarious. A break below 24,000 points could quickly lead to a further drop of 300 to 400 points. The next trading period will reveal whether the support holds or if the bears will gain control.
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