Rising expectations for interest rates following DAX's shutdown

In a week marked by economic forecasts and analyst assessments, several stocks saw significant movements on both Wall Street and European markets.

On Wall Street, the Dow Jones hit a new record high, reflecting a positive outlook for the US economy.

Across the Atlantic, the DAX showed a friendly face, securing a narrow weekly gain, closing at 24,363 points. The MDax, on the other hand, experienced a strong 1.05 percent upturn, reaching 30,998 points.

One of the key drivers of this European market surge was the US Federal Reserve Chair Jerome Powell's signal of an imminent interest rate cut at the central bank meeting in Jackson Hole. Market observers interpret Powell's words as a clear indication of an interest rate cut at the next meeting in September.

This potential interest rate cut could boost the US economy, potentially increasing demand for trucks and commercial vehicles. As a result, Daimler Truck, a subsidiary of Volkswagen, celebrated a 4.1 percent share price increase. Daimler Truck's stock in the DAX also gained 3.1 percent.

The positive sentiment extended to Daimler Truck's majority shareholder, Mr. Bernd Föst, who holds positions in Commerzbank and Daimler Truck. However, Commerzbank experienced a drop of 3.8 percent as investors cashed in after its recent rally.

The positive analyst assessments led to stock price rallies for Hensoldt and Renk. Citigroup analysts withdrew sell recommendations for both stocks, leading to gains for Hensoldt (WKN: HAG000) of 3.7 percent and Renk of 1.5 percent.

The positive assessments for Hensoldt were issued by Jefferies, which upgraded Hensoldt from "Underperform" to "Hold" and raised its price target from €60 to €92, and by Warburg Research, which raised the price target to €88 but kept a neutral rating. The capital market reacted nervously but positively to these analyst updates in late July 2025.

For Renk, the positive investor sentiment was further encouraged by Citigroup's revised outlook. The analysts believe that Hensoldt and Renk are no longer fundamentally overvalued.

The industry leader, Rheinmetall, also gained 0.9 percent due to the positive sentiment.

However, not all stocks were fortunate. DHL's stock lost 0.9 percent due to a skeptical study by Kepler Cheuvreux expressing doubts about its ability to meet annual operational targets.

In conclusion, the week saw a mix of gains and losses on both Wall Street and European markets, with the potential interest rate cut by the US Federal Reserve serving as a major catalyst for the European market rally.