FX.co ★ DAX Continues Record Run

On Wednesday, the DAX index in Frankfurt advanced by approximately 0.9%, closing at 25,122, thereby setting a new record and surpassing its regional counterparts. A pivotal factor driving this upward trend is the positive outlook for a German economic recovery projected for 2026, fueled by substantial federal government investment in infrastructure and defense. Concurrently, ongoing geopolitical tensions and unresolved conflicts have increased the demand for defense-related stocks. Market sentiment was further buoyed by the anticipation of declining oil prices following the United States' recent actions in Venezuela, potentially alleviating inflationary pressures and opening the door to additional central bank interest rate cuts. Eurozone inflation cooled to 2% in December, aligning with the European Central Bank's target, which bolstered the expectation that interest rates will remain stable for the time being. Leading the stock performance were Hensoldt, Rheinmetall, and Renk, with gains of 5.9%, 4.4%, and 3.5%, respectively. Other prominent gainers included Zalando, Siemens, MTU Aero Engines, Heidelberg Materials, and SAP, with respective increases of 4.9%, 3.5%, 3.1%, 2.9%, and 2.8%.