After the German leading index climbed to its highest level in two weeks, the red numbers took over after the ZEW release. The early positivity came from hopes of a nuclear disarmament of North Korea. However, today we witness the lowest ZEW for over five years as the index fell to its lowest level since September 2012, well short of expectations.

ZEW Index Crashes To Fresh Lows

The weakening German economy has sent the Dax on a bit of a rollercoaster today. According to the Center for European Economic Research (ZEW), the political situation in Italy and the US-based trade dispute weighed on the mood of German financial experts during the month to date.  Thomas Altmann of the asset manager QC Partners spoke of a “clear warning signal”. 

Especially when you couple this with the United States trade conflict, this combination is beginning to worry investors. The positivity from the US President Donald Trump’s agreement with North Korean leader Kim Jong Un regarding the nuclear disarmament is dying out as well.

Significantly more important issues are the upcoming bankruptcy meetings in Europe and the USA. “Draghi and Powell are the decision-makers on welfare and woe on the financial markets. So there will be more on that. 

Deutsche Post & Daimler

On the corporate side, the eyes once again turned to Deutsche Post and the carmaker Daimler. The “yellow brigade” are among the biggest losers today. The Bonn logistics company shocked investors last week with a profit warning because of problems in the letter and parcel business and announced a reorganization. Now, Jürgen Gerdes is going to go. Dissatisfaction with his many years as head of the core business (post, e-commerce, parcels) was the reason. 

The carmaker Daimler,  must recall 774 000 vehicles, including 238 000 in Germany because of the allegation of inadmissible shutdown devices in the exhaust process. Shares actually went up today with relief among investors as a potential billion-dollar loss may be averted.