Dax Index News: Forecast Brightens as Trump Boosts US-EU Trade Deal Hopes

DAX Extends Gains as Trump Extends Trade Deadline

Market optimism about a US-EU trade deal boosted demand for DAX-listed stocks. The DAX Index gained 0.55% on Tuesday, July 8, extending Monday’s 1.2% rally and closing at 24,074.

Optimism surrounding a US-EU trade deal underpinned gains in DAX-listed stocks. President Trump gave a glowing update on trade talks, reportedly stating,

“The European Union has been speaking to us, Ursula, and the whole group, and they have been very nice.”

Progress toward a trade deal offset weaker-than-expected trade data from Germany. German exports fell 1.4% month-on-month in May, following a 1.7% drop in April as exports to the US plunged 7.7%. German imports slid 3.8% vs. a 3.9% rise in April, signaling weakening demand as pre-tariff front-loading continued to reverse.

DAX Sector Snapshot: Auto and Bank Stocks Shine

Easing fears of Liberation Day tariffs on the EU boosted demand for bank stocks. Commerzbank led the gains, soaring 4.75%, while Deutsche Bank gained 0.62%.

Auto stocks also advanced on expectations of a US-EU trade deal. BMW and Mercedes-Benz Group rallied 2.25% and 1.98%, respectively. Volkswagen and Porsche also posted gains.

However, potential disagreements from within the EU on the terms of a trade deal capped the gains.

Wall Street Mixed on Tariff Headlines

US markets posted mixed performances on Tuesday, July 8, as investors reacted to Trump’s tariff moves. The Dow and the S&P 500 dropped 0.37% and 0.07%, respectively, while the Nasdaq Composite Index gained 0.03%.

Trump announced a 50% tariff on copper imports, triggering a 9.94% surge in copper prices. Prices climbed further in early trading on Wednesday, July 9, rising 3.62%. The US President also warned of potential tariffs on pharmaceuticals and semiconductors.

The overnight news could influence US-EU trade negotiations, especially if Trump intends to use specific tariffs to influence US-EU trade terms.

Fed Commentary and Trade Talks in Focus

Later in the July 9 session, investors should monitor Fed commentary on tariffs and monetary policy. Support for rate cuts based on easing concerns about tariffs fueling inflation could lift sentiment. Conversely, rising concerns about Trump’s latest tariff announcements and a potential pickup in inflation may impact risk assets such as the DAX.

Key Catalysts for the DAX

The DAX’s near-term outlook hinges on US-EU trade news and central bank guidance.

• Bullish Case: A US-EU trade deal and dovish central bank cues may drive the DAX toward the 24,500 mark.
• Bearish Case: Stalled US-EU trade talks or hawkish central bank rhetoric may pull the DAX below 24,000, exposing the 50-day EMA.

At the time of writing on July 9, the DAX futures rose 29 points, while the Nasdaq 100 was down 23 points. Futures markets signaled a choppy start to the mid-week session.

DAX Technicals

After a bullish start to the week, the DAX trades well above the 50-day and 200-day Exponential Moving Averages (EMA), signaling bullish momentum.

• Upside Target: A breakout above 24,250 could signal a move toward the June 5 high of 24,479. A sustained move through 24,479 may bring 24,750 into sight.
• Downside risk: A break below 24,000 may expose 23,500 and the 50-day EMA.

The 14-day Relative Strength Index (RSI), at 59.56, suggests the DAX could climb to 24,479 before entering overbought territory (RSI > 70).

DAX Outlook: Trade Developments and Central Bank Rhetoric

Traders should closely monitor US-EU trade talks and central bank commentary. The threat of Liberation Day tariffs would likely weigh on the DAX. Conversely, progress toward a trade deal could drive demand for DAX-listed stocks. Trade developments will have greater weight than central bank chatter.

Explore our exclusive forecasts to assess whether improving trade sentiment could lift the DAX to new highs. Refer to our latest forecasts and macro insights here for further analysis, and consult our economic calendar.