DAX Index Analysis - July 15, 2025
On July 15, 2025, the DAX index experienced a modest rise of 0.26%, reaching 24,224 points, driven by investor optimism surrounding potential trade negotiations between the US and the EU. This sentiment was bolstered despite ongoing tariff threats from both sides, as hopes for a trade deal remained alive.
Trade Tensions and Economic Sentiment
The European Union (EU) has prepared a list of countermeasures targeting US goods worth €72 billion ($84 billion), which includes various products such as Boeing aircraft, automobiles, and bourbon. This escalation in trade tensions comes as trade talks between the US and EU have stalled. However, President Trump expressed a willingness to continue discussions, with EU negotiators expected to return to the US before the August 1 deadline. Failure to reach an agreement could result in a 30% tariff on EU goods.
Sector Performance
In the context of these developments, auto stocks saw gains, with notable increases from major companies like Mercedes-Benz Group (up 1.17%) and other automotive giants such as BMW, Porsche, and Volkswagen. Additionally, German banks also advanced, with Deutsche Bank rising by 1.02% and Commerzbank by 0.12%.
Economic Indicators
Attention turned to the upcoming ZEW Economic Sentiment Index, which is anticipated to rise from 47.5 in June to 50 in July. A positive shift in sentiment could further enhance demand for DAX-listed stocks, while a lower reading might dampen investor enthusiasm.
US Market Influence
US markets also showed positive movement, with the Nasdaq Composite Index gaining 0.27% and the S&P 500 rising by 0.14%. Investor sentiment was buoyed by the perception that US tariffs would have a limited impact on the economy, alongside recent labor market data indicating resilience, which has reduced recession fears significantly.
Inflation and Earnings Reports
Upcoming US inflation data is critical, with expectations for the annual inflation rate to increase from 2.4% in May to 2.7% in June, and core inflation projected to reach 3%. Higher inflation could delay Federal Reserve rate cuts, impacting risk assets like the DAX. Conversely, softer inflation data could bolster expectations for rate cuts, enhancing market sentiment.
Outlook and Technical Analysis
The near-term outlook for the DAX is contingent on the outcomes of US-EU trade discussions, US inflation data, and central bank policy signals. A bearish scenario could arise from escalating trade tensions or higher-than-expected inflation, potentially pushing the DAX down to 24,000. In contrast, a successful trade deal and lower inflation could propel the index towards its July high of 24,639.
Technical indicators suggest a bullish bias, with the DAX remaining above the 50-day and 200-day Exponential Moving Averages (EMA). A breakout above 24,500 could lead to further gains, while a drop below 24,000 may trigger increased selling pressure.
Conclusion
As the market navigates through trade developments and economic data, volatility is expected to persist. Investors are advised to stay informed on both technical and fundamental factors influencing the DAX index.