Dax

USD/JPY rises as U.S. Treasury yields rise above 5%. DAX slumps as bond rout continues and oil prices surge.

Following a weak handover from Asia, European markets and US indices were under pressure this morning, as rising oil prices and elevated bond yields once again weighed on risk appetite. Among the major European indices, the German DAX will be in firm focus this week, with the ECB’s rate decision coming up on Thursday. That decision is likely to be a hike, as rising oil prices threaten to re-accelerate inflation.

Oil rises amid escalating Middle East hostilities & as OPEC+ keeps output steady. DAX cautious after AfD election victory and ahead of ECB rate decision.

DAX rises as Nvidia boosts AI trade ahead of Jackson Hole. GBP/USD slips below 1.36 as Fed expectations shift.

But the question, of course, is how much further oil prices and bond yields can fall. For now, the combination is supportive of risk assets and is helping to sustain a relatively benign decline in the dollar. The focus today will be on US core PCE inflation, due for release shortly, while Nvidia’s second-quarter earnings will provide another test for risk appetite after the US markets close – not just for US indices but for global tech-heavy indices given the influence Nvidia has over the global tech and AI names.

DAX edges higher as German economy shows resilience. Oil falls despite Bessent’s plans for the economic isolation of Iran.

GBP/USD Rises After UK Inflation Ahead of FOMC Minutes. DAX Rises as Global Bond Sell-Off Eases.

If oil prices continue to rise, this could weigh on European markets which have been quite resilient of late. That could weigh on the German DAX forecast given the nation’s reliance on energy imports.

Volatility across financial markets continues to subside, with investors appearing surprisingly comfortable with rising oil prices and the prospect of the Fed either holding rates steady or tightening policy in September.

Equities have steadied somewhat so far into Tuesday’s session, finding a bit of a floor on reports that the US may be prepared to wind down military operations in Iran—even if the Strait of Hormuz remains shut.

In the last couple of days, markets are increasingly attempting to price in the possibility of easing geopolitical tensions in the Middle East. We have seen, equity markets have staged a modest recovery, while the euro has stopped falling. Yet, the market’s reaction has been measured rather than exuberant. Investors appear willing to respond to positive developments, but few are ready to assume that a definitive breakthrough is imminent.

The DAX 30 will soon be admitting ten more companies in a move that will affect the industry makeup, weighting potential and the regulatory practices of Germany’s flagship stock index. Here’s more on the move from DAX 30 to DAX 40.