Germany’s DAX Hits Record High After Brexit Deal, U.S. Stimulus
(Bloomberg) -- Germany’s DAX Index climbed to a record high ten months after the pandemic-fueled equity rout, amid investor relief following a Brexit deal and as U.S. President Donald Trump signed a coronavirus stimulus package.
The index gained 1.5% on Monday, surpassing its February intraday high, while the broader Stoxx Europe 600 Index is still yet to recover all of the losses suffered earlier this year. In its fastest-ever rebound from a major selloff to a fresh peak, the German gauge has surged 67% since a six-year low in March, helped by the likes of chip company Infineon Technologies AG and carmaker Daimer AG.
The rally in the exporter-heavy benchmark comes after the U.K. and the European Union finally agreed on a Brexit trade deal and as investors look past the country’s rising coronavirus cases toward an anticipated global recovery next year spurred by vaccines.
All 30 members in the DAX have climbed since the March low, with Daimler AG and Infineon Technologies AG leading the pack as their shares have more than doubled.
Other country benchmarks have beaten the DAX in recouping pandemic losses and climbing to an all-time high this year. While the S&P 500 first did so back in August, gauges of India, South Korea and Turkey have also hit the milestone sooner than the German measure.
Still, many investors and analysts are optimistic about prospects for cyclical shares -- which have a heavy weighting in the DAX -- in 2021. Strategists expect the benchmark’s rally to continue into next year, with the average forecast calling for an amost 4% advance from the current level.
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