The DAX is approaching a very strong time of year having risen every single year during April. Last year brought 13.80% returns, whilst the lowest gain was 2.05% in 2017. News from President Biden that 90% of the population will be vaccinated by April 19th is supportive for risk assets that will support equities like the DAX. A $2 trillion USD stimulus package should further underpin global stocks.
DAX is being supported by a sharp rise in Volkswagen shares following last month’s reveal that they plan to compete with Tesla in the electric vehicle sector.
Key Trade Risks:
- Many investors consider the equity markets overbought so a correction may be coming.
- Another breakout of COVID-19 could slow down European companies.
- Any new strong COVID-19 variant may invalidate this outlook.
- The US stimulus bill could find roadblocks and put pressure on global stocks like the DAX.