Germany's MDAX index posts biggest one-day drop in 2 months, down 1.4%

Germany's MDAX index posts biggest one-day drop in 2 months, down 1.4%

The Germany's MDAX index experienced its largest one-day drop in two months, falling by 1.4% on Monday, June 10, 2025. The index, which tracks the 40 largest and most traded German stocks on the Frankfurt Stock Exchange, closed the day at 24,259 points, down from 24,479 points on Friday, June 7, 2025 [1].

The decline was attributed to several factors. Firstly, the European Central Bank's (ECB) moderate signals at its press conference dampened further hopes of interest rate cuts, which had previously boosted the DAX. Secondly, the US labor market report, scheduled to be released in the afternoon, was expected to show lower job growth compared to the past two months, which could have a significant impact on market sentiment [1].

The US labor market report, which contains data from the private sector, was unexpectedly weak on Wednesday, with the ADP report showing lower job growth. However, wage growth is expected to be a critical factor for the US Federal Reserve, and the expected slowdown in growth could make it easier for the Fed to cut its key interest rate later in the year [1].

The DAX, which had extended its positive performance for the year on Thursday with a new high following the ECB's interest rate cut, saw its weekly gain melt away to just under one and a half percent [1].

The DAX's performance has been closely linked to the DAX® index, which is tracked by the Deka DAX UCITS ETF. The ETF seeks to replicate the performance of the DAX® index, which includes 40 of the largest and most traded German stocks listed on the Prime Standard segment of the Frankfurt Stock Exchange [2].

Investors and financial professionals should monitor the upcoming US labor market report and the ECB's future policy decisions to gauge the potential impact on the DAX and other European indices. The DAX's recent performance highlights the importance of keeping an eye on macroeconomic indicators and central bank policies [1].

References:
[1] https://www.marketscreener.com/quote/index/DAX-7395/news/DAX-FLASH-Slight-losses-ahead-of-US-labor-market-report-50173853/
[2] https://www.justetf.com/en/etf-profile.html?isin=DE000ETFL011