In morning trading after the holiday, the DAX has again jumped significantly above the 15,000 point mark and is already trading at around 15,150 points (as of November 2, around 11 a.m.). Above all, hopes for the end of interest rate increases, including strong guidance from Wall Street, have pushed the German leading index.

After a weak October, the DAX has now returned to bullish waters at the start of the new month. Many investors had already written off an end-of-year rally, but at the moment some of the dark clouds over the stock markets have disappeared. In the medium term, there is still great upside potential, but corrections are still possible in this fragile environment.

Why the DAX is climbing so significantly After the ECB, the US central bank Fed has also followed suit and announced another interest rate pause – the key rate remains unchanged at a high level in a range between 5.25 and 5.5 percent. This step was expected in advance. Although Fed Chairman Jerome Powell announced after the meeting that interest rate cuts are currently not an issue and has left all backdoors open for further increases.

Nevertheless, investors‘ hopes are now greater than ever that the interest rate peak has been reached and there will be no further interest rate increases. Powell also signaled that he will proceed with caution. After Powell’s words, tech stocks were in demand – the NASDAQ rose by a good 1.7 percent. At the same time, the yield of the recently strong US government bonds fell back.

With these guidelines from Wall Street (also Dow Jones and S&P 500 were able to gain), the DAX easily jumped over the contested 15,000 point mark. Also, the partly strong quarterly figures from Fresenius or Lufthansa have given the leading index a boost.

What will happen next with the DAX? With today’s turnaround, the late start of a year-end rally could have been set off for the DAX. After the price drop of almost 4 percent in October and a very weak performance in the past 3 months, the upside potential for the DAX is great.

However, this is far from a foregone conclusion: If there is no progress in the fight against inflation, further interest rate increases by the Fed and the ECB are still conceivable in 2023. In addition, the geopolitical situation is very tense. With further bad news, significant corrections are also possible again – overall, however, the chances are currently overwhelming.