Unforeseen Setbacks for Dax - Financial Analyst Predicts Increased Market Volatility and Inadequate Secured Assets
DAX Faces Volatility as Economic Uncertainties Mount
The DAX index started trading on Wednesday with losses, dipping 0.5% to around 24,290 points by 9:30 AM. This marks the second consecutive day this month that the index has fallen more than one percent, reflecting a cautious to mildly bearish market sentiment.
The current market turmoil is attributed to a sharp drop in the German GfK Consumer Sentiment Index, which fell to -23.6 in September 2025, its lowest since April. Fears around job security, inflation, and geopolitical risks are causing a weakening of consumer confidence, potentially leading to a contraction in consumer spending, which accounts for about 60% of Germany’s GDP.
Despite the year-to-date gains of around 28.20%, the DAX and other European equities could still be affected. From a technical perspective, the index is showing signs of consolidation near support levels around 24,000 points, but technical patterns like the bear flag and bull flag/triangle suggest mixed signals.
Market analyst Thomas Altmann from QC Partners stated that the European indices are facing a test. He believes that a breakout to the upside could yield gains in the range of 100 to 400 points, possibly retesting levels near 24,600–25,000 if bullish momentum materializes. However, the presence of significant resistance levels and a current majority short trader positioning (71% net short) indicates volatility and uncertainty in market direction.
Factors influencing future DAX movement include domestic economic trends, inflation and employment outlook, geopolitical risks and political uncertainties, technical breakouts, sectoral performance, and the upcoming central bank symposium in Jackson Hole.
Meanwhile, the oil price rose on Wednesday, with a barrel of North Sea Brent crude costing $66.33 at 9 AM German time, an increase of 54 cents or 0.8% compared to the close of the previous trading day. The Dax's top performers on Wednesday were Deutsche Telekom, Henkel, and Merck, while Rheinmetall, MTU, and Siemens Energy showed the strongest declines.
Despite the current market volatility, Altmann remains optimistic, stating that one weak trading day does not indicate the end of the impressive rally. He emphasized that investors on the stock exchange must now expect higher volatility in the coming days.
[1] Source: GfK Consumer Confidence Barometer, September 2025 [2] Source: TradingView, Investing.com [3] Source: CNBC, Bloomberg [4] Source: Reuters, Financial Times [5] Source: Deutsche Börse AG, Bloomberg Finance L.P.
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