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DAX Dips, German CPI Ahead

The DAX has dropped considerably in the Wednesday session. Currently, the DAX is at 11,511 down 0.56% on the day. In economic news, there are no major German or eurozone events. On Thursday, Germany releases Preliminary CPI.

Risk appetite remains strong, and the DAX has responded well. On Tuesday, the DAX climbed to 11,556, its highest level since early December. With President Trump waiving his threat to impose new tariffs on China next week, risk appetite remains strong. There is even talk of a meeting between Trump and Chinese President Xi at the end of March if the sides reach an agreement. However, significant questions remain. With almost no news about the substance of the talks, it remains unclear if China will agree to substantial structural changes in trade, as demanded by the United States. Another question mark is whether the current set of tariffs will be completely removed if a deal is reached. Still, if the sides reach a deal, it could fuel a strong rally in global stock markets. Meanwhile, Trump is meeting with North Korean leader Kim in Hanoi, and any tangible steps to denuclearize North Korea could trigger strong gains for equities.

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