Stock Highs

Little Room for Growth

Germany’s key stock market barometer, the DAX, has been surging from record to record. Source: DPA

The DAX just keeps on climbing. Freed from the fears of a European political swing to the right after France’s election, Germany’s leading stock index has set one record after another in the last few weeks. Since the start of this year, the index of Germany’s 30 largest companies on the Frankfurt Stock Exchange has grown 11 percent, pushing the index to 12,783 points. In the last 12 months, the DAX has climbed about a quarter.

The impressive gains are fueling a new round of optimism for the coming year. Numerous banks have raised their forecasts for 2017 by about 1,000 points. These optimists see the DAX around 13,500 points by year’s end, thanks both to less political uncertainty and a strengthening German and European economy.

For some, the optimism goes even further: Some analysts are starting to call 2017 a turning point after six weak years: “More economic growth and growing company earnings are currently pushing stock markets to new heights,” said Ulrich Stephan, chief investment strategist at Deutsche Bank.

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