Relief Rally on Tuesday: DAX Reclaims 100-Day Moving Average Despite Historic Order Shock!
The German benchmark index emphatically continued its recent recovery rally. With a convincing gain of 0.77 percent, the DAX closed at 25,449.19 points, dynamically jumping over the closely watched 100-day moving average, which it had failed to break in recent days. At times, the stock market barometer even climbed above the 25,500 mark. The pronounced resilience of the market was remarkable: a drastic 10.6 percent slump in German industrial orders in August was simply shrugged off on the trading floor. Since this decline was primarily due to a lack of major defense orders, only defense stocks logically came under pressure, while the broad market base was supported by positive underlying sentiment.
Geopolitical Glimmer of Hope: Oil Price Setback and Wall Street Records Fuel Buying Mood
The fundamental fuel for this upswing came from several sides. Reports of diplomatic talks between the US and Iran regarding the opening of the Strait of Hormuz provided noticeable relief. Driven by this hope, Brent crude briefly slipped below the psychologically important $100 mark. This easing was flanked by a marked calming in the bond markets, where falling government bond yields provided a tailwind. Additional thrust was supplied by Wall Street with a fresh record high for the technology-heavy Nasdaq 100. The rebound from the 200-day moving average is thus solidifying, even though the all-time high is still a good four percent away.
Fed Minutes and Porsche Day: Is the DAX Now Targeting the Previous Week's High?
Mid-week, a dense mix of economic data and monetary policy signals moves into focus. In the morning, German industrial production will deliver valuable insights into whether the industry is showing weakness beyond yesterday's defense effect. At the corporate level, Porsche AG's Capital Markets Day will draw attention in the morning. The absolute highlight of the trading day, however, waits in the evening: at 8:00 p.m., the US Federal Reserve will publish the minutes of its historic September meeting. This document will ruthlessly reveal how united the Fed committee was during the recent interest rate pivot. The core question is: Will the minutes underpin the December rate hike, which the market has already priced in at over 75 percent, and does the DAX possess the substance to defend the conquered 25,400 mark and tackle the previous week's high of 25,617 points?
The information provided does not constitute investment research. The material has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and as such is to be considered to be a marketing communication.
All information has been prepared by ActivTrades (“AT”). The information does not contain a record of AT’s prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.
Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not a reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acting on the information provided does so at their own risk. Forecasts are not guarantees. Rates may change. Political risk is unpredictable. Central bank actions may vary. Platforms’ tools do not guarantee success.