European equity markets continued their upward trend on Thursday after the US mid‑term elections. The German DAX rose as much as 0.8% in the morning, reaching 26,654.56 points and surpassing the record set at the end of August. The Swiss Market Index defended the 15,000‑point level it breached for the first time on Wednesday. The EuroStoxx50 gained 0.5% to 6,297 points.
Market analyst Andreas Lipkow of CMC Markets said risk appetite had risen noticeably after the new political balance in the United States shifted several key framework conditions. Investors also bet on a possible end to the conflict between the United States and Iran, which contributed to a sharp decline in oil prices. The rally was further supported by US President Donald Trump’s immediate acceptance of the election outcome.
Strategists cautioned that the equity rally might be fragile. Kyle Rodda, market analyst at capital.com, noted that peace talks were currently limited to rhetoric and warned that a weakened President Trump could act more aggressively abroad if he sought to retain influence.
Oil prices recovered about 1% after three days of steep declines. On Wednesday, Brent and WTI crude had each fallen more than 8%, reaching their lowest levels since the end of August. Trump acknowledged that the US‑Iran war had influenced the Republican loss in the mid‑terms. Lower energy prices eased inflation concerns and reduced pressure on central banks to keep rates high.
German ten‑year bund yields fell to 3.271%, while the euro remained steady at 1.1232 US dollars. German industry reported an increase in September orders, a point noted positively by local economists. The US dollar stayed under pressure, which supported metal prices. Gold rose 1.7% to $4,128 per ounce, as a weaker dollar makes gold cheaper for holders of other currencies.
Market participants now await the US jobs report on Friday to better gauge the Federal Reserve’s monetary outlook. Later in the day, the Bank of England is set to announce its interest‑rate decision, with expectations of a hike due to persistent inflation.
The travel and tourism sector, sensitive to jet‑fuel prices, posted a 1.6% gain. Shares of Deutsche Lufthansa and Ryanair each climbed more than 2.3%. Air France‑KLM surged over 11% after reporting a surprisingly strong quarterly profit. In the commodities space, ArcelorMittal rose more than 4% on robust steel demand and a solid operating profit in the third quarter. Within the DAX, Zalando, Bayer and Heidelberg Materials attracted particular interest.
The technology segment lagged, especially on Asian exchanges, amid fears that stricter regulation by the new US Democratic majority could curb the sector’s growth. In Amsterdam, ASML shares fell roughly 3% and Soitec dropped 4.5%. Defense stocks also retreated, led by Rheinmetall, which fell 18.4% to €818.70 after cutting its targets twice within three months, making it the DAX’s biggest loser. Deutsche Telekom and Commerzbank slipped 2.5% and 1.8% respectively; Telekom’s quarterly results were described as strong, but investors had hoped for a higher dividend, while Commerzbank’s profit growth fell short of analyst expectations.
