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DAX Outlook: Auto Tariff Risk Places EU-US Commerce Warfare Again in Focus

DAX Evaluation and Information

DAX Dives as Trump Reportedly Mulls Auto Tariffs

Stakes are Raised for a Profitable G20 Summit

EU Rebuts Preliminary Experiences

DAX Dives as Trump Reportedly Mulls Auto Tariffs

The auto heavy DAX index briefly fell to session lows to interrupt under 11300 and underperform its main counterparts after reviews from German press that President Trump might impose auto tariffs at a fee of 25% as early as subsequent week (after the G20 summit). As a reminder, auto names Daimler, Volkswagen and BMW, comprise of roughly 11% of the DAX index.

Stakes are Raised for a Profitable G20 Summit

With these quite well timed reviews surfacing simply forward of the G20 summit, this subsequently raises the bar for Malmstrom and Juncker to ease tensions on the summit and keep away from an escalation of commerce wars between the US and EU. If, nevertheless, talks fail, this raises the chance that the Trump administration will look to position auto tariffs on the EU, which in flip will increase the draw back dangers to an already difficult marketplace for the Eurozone. Significantly in Germany, the place the final quarter noticed the primary contraction in development since 2015.

EU Rebuts Preliminary Experiences

Following the reviews from German press a spokesman has now rebutted these reviews, stating that Malmstrom is just not scheduled to fulfill Lighthizer. Nevertheless, regardless of this, markets will possible maintain an in depth lookout for any fall out relating to EU-US tensions.

Background of commerce wars

Impression of Commerce Wars, click on right here

DAX Worth Chart: 1-Minute Time Body (Intraday)

DAX Outlook: Auto Tariff Threat Puts EU-US Trade War Back in Focus

Chart by IG

IG Consumer Sentiment exhibits that 63.1% of merchants are net-long with the ratio of merchants lengthy to quick at 1.71 to 1. The mixture of present sentiment and up to date adjustments provides us an extra blended buying and selling bias for the DAX.

How you can Commerce the DAX

— Written by Justin McQueen, Market Analyst

To contact Justin, electronic mail him at Justin.mcqueen@ig.com

Comply with Justin on Twitter @JMcQueenFX


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