- DAX is attempting a recovery following a 6% drop.
- The global energy shock is fueling stagflation anxiety, notably causing a record 12% plummet in the South Korean KOSPI index.
- Market performance is mixed: Technology and defense stocks are providing upward momentum, while disappointing earnings from Adidas and Bayer are weighing on the index.
- The technical outlook is bullish, with buyers returning to test the 24000 psychological level, hinting at a potential move to the upside.
The DAX index is attempting a recovery today following two sessions of aggressive selling driven by escalating conflict in the Middle East.
Market sentiment saw a slight boost after President Trump suggested the US Navy might escort oil tankers through the Strait of Hormuz. This strategic chokepoint currently remains at a standstill, causing significant disruptions to global energy flows.
Despite the diplomatic overtures, oil prices have continued their ascent climbing 14.5% so far this week, while European natural gas prices have surged a staggering 60% over the last two days following the shutdown of Qatari LNG facilities and the closure of the Strait.The economic impact of these spikes is being felt acutely across energy-dependent regions.
While the DAX shed 6% over the last two sessions, the South Korean Kospi plummeted 12% overnight, reflecting a growing global anxiety over potential stagflation. This is the KOSPI benchmarks largest drop on record as South Korea is heavily reliant on Middle Eastern oil.
Over two days the tech-heavy index has lost more than 18% of its value while the currency KRW has slumped to a 17-year low.
The trajectory of the market now hinges on the duration of the conflict and whether energy prices ease. A prolonged standoff increases the risk of a sustained energy shock, which could cement the stagflationary pressures currently being priced in by traders.
According to sources, Qatar would need 2 weeks to restart gas liquefaction after a full shutdown. Once restarted, Qatar would need at least another 2 weeks to reach full capacity, which could lead to a temporary shock in prices if the conflict was to reach a swift conclusion.
Performance within the DAX remains a mixed bag of sector-specific reactions and corporate earnings.
Technology stocks are providing some upward momentum, with Infineon Technologies rising 3.7%, while defense stocks are seeing a modest recovery.
However, individual earnings reports are weighing on the index; Adidas shares dropped 7% on disappointing results (now down 5%), and Bayer fell 4.76% after providing a weak 2026 profit outlook that overshadowed a fourth-quarter earnings beat.
Source: LSEG
Trade Idea – Potential DAX Buy Opportunity
The DAX selloff saw the index drop below the psychological 24000 handle for the first time since December 2025.
The foray has proved short-lived thus far with buyers returning as the index tested the descending channel it broke out of in December 2025.
On the daily chart, the current daily candle is eyeing a close back above 24000 while at the same time printing an inside bar hammer candle.
This would hint at a move to the upside in the days ahead.
DAX Index Daily Chart, March 4, 2026
Source: TradingView
For those looking to get involved, we drop down to a one-hour chart.
Price is caught between the 20 and 50-day MAs with a retest of the 24000 handle presenting the best risk to reward opportunity for would be bulls.
If such a pullback does not materialize, traders may wait for a break of the 50-Day MA at 24210 and look for an opportunity to get involved with targets resting at the 100-day MA around 24700 and potentially 25000 as well.
DAX Index, One-Hour Chart, March 4, 2026
Source: TradingView
