Over the last 25 years, the two weakest months of the year for the DAX have been August and September. This year, at the time of writing, the DAX has fallen just over 5% so far. The question is, will the summer slump continue?
Looking into the detail of the DAX’s seasonality, we can see some interesting data. First of all, the average falls between August 21 and September 30 have been 2.64%. However, the total number of falls has only been 48%, so whether the year is a gain or a loss has been roughly evenly split. The noteworthy point though is that falls have outstripped gains in the extent of those falls.
So, with markets nervous about the prospects of global growth, China’s slow-down worries, high-rate expectations weighing on US stocks, and uncertainty over the health of Europe’s economy, can DAX fall again this summer?
Major Trade Risks: The biggest risk here has to do with the path of Europe’s economy and that will depend on upcoming data.
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