The DAX index is rising today as part of the global rally in equities. The blue-chip German index is up by 0.52% with most of its constituent companies being in the green. Other European, Asian, and American indices are also in the green.
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There are several things moving the DAX index today. First, in the United States, there are signs that Donald Trump’s health is improving. While he still has a long way to go, his doctors have assured the public that all of his vitals are doing well. He even took a short-distance drive to greet some of his supporters.
Second, there is a possibility that US politicians will reach a stimulus deal. While talks between leaders have stalled, Nancy Pelosi confirmed that she and Mnuchin had made some progress. Still, with the election just a few weeks away, there is also a possibility that the two sides will not reach a deal. A stimulus in the US will be a good thing for the DAX index because of the volume of business that German automakers do there.
Third, there is a new wave of consolidation in Europe. Over the weekend, it was reported that Nexi and Sia were planning to merge in a deal that will create one of the biggest fintech companies in Europe. In another deal, NEC announced that it would acquire Avaloque, a Swiss payment company. Analysts expect more deal-making to continue.
Automakers are among the best performers in the DAX today. Volkswagen, Daimler, and BMW share prices have all gained 1.65%. Other top-performers are Deutsche Bank, Deutsche Telekom, and BASF. Bayer, the embattled chemicals giant has also gained by more than 1%. On the other hand, Delivery Hero, SAP, and Linde are among the worst performers.
DAX index technical outlook
The daily chart shows that the DAX index has been trading in a narrow range in the past few days. It is trading at €12,762, which is above last week’s low of €12,534. The price is a few points below the 25-day EMA and is slightly below the important support of €13,340.
Therefore, in the near term, the outlook for the DAX is neutral, with the key support and resistance levels being at €12,534 and €13,340.