At the beginning of 2016, the DAX was in a continuous downward trend, which manifested itself in weeks of falling prices and almost completely lost the profit of the previous year 2015. The reasons cited were the falling oil price and the resulting profit-taking by Arab and Norwegian sovereign wealth funds, which were thus able to offset the declining revenues from oil trading.
The Chinese speculative bubble, which reached its peak at that time and also had a significant (negative) impact on the European indices, was interpreted as a further cause of the massive price losses and a drop from the DAX to below 10,000 points. The downward trend continued and resulted in the DAX falling below the 9,000 point mark. A rising euro and further falling oil prices caused a flight of investors, which sent massive selling signals to the stock market.
After an interim recovery and the breach of the 10,000 point mark, the vote of the British on the Brexit gave the DAX a bitter and momentous setback. The leading index lost almost seven percent on a single trading day after the result of the vote became known.
By the middle of the year, however, the DAX had risen, reaching an all-year high of 10,700 points in August. The upswing was driven by a cut in the Bank of England’s key interest rate and other bond purchase programs.
The election of Donald Trump as the new US President at the end of the year temporarily caused a new setback. However, the DAX recovered relatively quickly and benefited from speculation about higher US government spending in the future and a possible planned reduction in corporate taxes, which would have a positive impact on the stock market.
At the end of 2016, the benchmark index strong price gains and scratched the 11,000 point mark. The robust economy, positive economic news and low interest rates ensured constant economic growth and thus an increase in private household consumption as well as rising corporate profits.
The high performance of the German share index continued at the beginning of 2017. Rising corporate profits of the 30 listed corporations (40 billion euros in the second quarter alone) and the ECB’s continuing extremely loose monetary policy with a very low interest rate level caused a lot of money to flow into the stock markets and the majority of prices to rise.
Driven by the result of the French presidential election, the DAX reached its highest level since its introduction in 1988 at the end of April 2017. 12,398 points exceeded the April 2015 mark by eight points. The election result in France triggered a real buying marathon of European equities and the euro also rose to its highest value since the beginning of the year.
At the beginning of June 2017, the DAX climbed to an interim record high of 12,850 points following the announced withdrawal of the USA from the Paris Climate Agreement. This meant an upward swing in the trading range between 12,500 and 12,700 points held since the middle of the year.
In mid-August 2017, the diplomatic crisis in the nuclear dispute between the USA and North Korea weighed on the index, which temporarily fell below 12,000 points. However, the good mood in the German economy, positive labour market data, record corporate yields and the ECB’s continued loose monetary policy quickly brought calm to the markets and led to a positive development.
At the beginning of October 2017, the DAX then reached a new high for its term in the form of 12,975 points. This meant the highest level of his 30 years of existence. Since the beginning of the year, the leading index has recorded an increase of around 13 percent, and since March 2009 the value of the DAX has almost tripled.