On May 6, 2025, European stock markets showed a positive trend as major indices rallied, reflecting investor optimism amid ongoing global economic shifts. The German DAX, which has been on a remarkable recovery trajectory since hitting a low in April, gained 0.10 percent, reaching 23,367 points and coming close to its record high of 23,476 points. This resurgence is part of a broader recovery seen across European markets, with the French CAC 40 and the British FTSE also posting gains.
The DAX, which serves as a benchmark for 30 of Germany's largest blue-chip companies, has a historical base value of 1,000 established on December 31, 1987. It is calculated using only XETRA equity prices since June 18, 1999. On the same day, the MDax, which tracks medium-sized companies, rose by 0.27 percent to 29,697 points, while the EuroStoxx 50, a leading index for the eurozone, was up by 0.1 percent.
Investors are closely monitoring the ongoing corporate reporting season in Germany, with companies like Continental delivering impressive results. This has contributed to the overall positive sentiment in the markets. However, uncertainties linger due to external factors, including U.S. President Donald Trump's import tariffs and the implications of Friedrich Merz's recent election as the new German chancellor. Analysts believe that the new government's extensive investment package in infrastructure and defense could bolster the German economy.
“Since hitting rock bottom in April, the DAX has made a rapid V-shaped recovery,” commented Jochen Stanzl, an analyst from broker CMC Markets. He noted that while fears of a recession are prevalent, the current data does not support such concerns, suggesting that the worst of the uncertainty may be behind the stock market.
Meanwhile, across the Atlantic, U.S. indices have experienced fluctuations after rallying to significant highs last week. The Nasdaq 100 index, which reached a five-week high on Friday, May 2, 2025, has since edged lower, indicating a need for caution among investors. A close below the support level of 19,000 could signal more substantial weakness ahead.
The Dow Jones index has seen a steady climb, gaining over 4,500 points from its April low. However, it has faced resistance recently, with the mid-March low at 40,630 potentially offering support. Analysts suggest that a close back above 41,430 could trigger a new upward movement, targeting levels around 42,000 and the March high of 42,760.
As for the DAX's performance, its bounce from the April low has positioned it near the record highs of March. Early trading on May 6 showed the DAX just 60 points shy of its previous record, with short-term losses potentially finding support at the early April high of 22,689.
The Russian RTSI index, which measures the performance of the 50 most liquid Russian stocks, stood at 1,144.79 points on May 5, 2025. This index is calculated in real-time by the Moscow Exchange and disseminated by S&P Dow Jones Indices.
Overall, the European markets are reflecting a cautious optimism as investors weigh corporate performance against geopolitical uncertainties and domestic political changes. With various factors at play, including tariff negotiations and the new German government's policies, market participants remain vigilant as they navigate this dynamic economic landscape.
