Stock markets are showing surprising resilience. Despite the ongoing Iran conflict, which has fueled uncertainty for thirteen trading days, the DAX gained another 0.7% in early trading, reaching 23,900 points. This marks what would be the third consecutive day of gains.
This slight recovery suggests investors are gradually pricing in the recent geopolitical tensions. Markets appear to be adjusting to the new reality, even as the situation in the Middle East remains volatile.
All eyes are now on the U.S. Federal Reserve. Its upcoming interest rate decision could quickly end this brief market respite. According to Tagesschau, the Fed intends to wait and see how long the Iran conflict and disruptions in energy markets persist.
Central bankers face a delicate balancing act. If the situation calms soon and longer-term inflation expectations remain stable, they might view the price shock as a one-off effect that only temporarily boosts inflation. That would be a positive signal for markets.
Yet uncertainty lingers. Individual stocks like Commerzbank illustrate how fragile the recovery can be. Its shares recently gave up some gains after briefly climbing to €36.27. The test of the consolidation trend since August proved negative.
Meanwhile, experts and investors are debating tax policy issues. A proposal to tax unrealized capital gains, modeled after Dutch practices, is sparking intense reactions. While some point to greater tax fairness, many see it as a deep intrusion into private retirement savings. One reader commented via Yahoo News: “It’s madness—you’re supposed to take personal responsibility for your old-age provisions, and the state takes that capital away again.”
For German investors, the current situation is a tightrope walk. On one hand, the DAX’s slight recovery offers short-term opportunities. On the other, risks from the Iran conflict and upcoming Fed decisions remain high. The coming days will reveal whether optimism holds or concerns regain the upper hand.
The Fed will certainly wait to see how long the Iran war and the disruptions in the energy markets drag on
Fed — Tagesschau
