DAX on cautious note on Monday

The DAX in Frankfurt hovered just below the 24,000 mark on Monday, maintaining levels close to its June 9 peak as investors weighed ongoing trade uncertainties with cautious optimism.

Market participants remain on edge amid escalating concerns over the U.S. administration’s stance on tariffs. President Donald Trump confirmed that he does not intend to extend the current 90-day pause on tariffs for most nations beyond the July 9 deadline, the expiration of the negotiating period he initially set.

His administration is preparing to notify nearly 200 countries that trade penalties will be implemented unless comprehensive trade agreements are reached with the United States. This announcement has injected a degree of tension into the markets, tempering broader risk appetite and underscoring the fragile state of global trade talks.

Meanwhile, economic data from Germany remains in the spotlight as investors search for early indications of the European Central Bank’s next policy moves. Inflation figures and retail sales reports, both due for release shortly, will be closely scrutinized for signs of economic resilience or softness in the eurozone’s largest economy. These data points are expected to provide clues on whether the ECB will lean towards easing monetary policy or maintain its current stance amid mixed economic signals.

Adding to the market’s focus is the high-profile ECB Forum taking place in Sintra, Portugal. The event features speeches from several ECB officials and is particularly noteworthy for the panel discussion including ECB President Christine Lagarde alongside the governors of the U.S. Federal Reserve, the Bank of England, and the Bank of Japan. This rare gathering of central bank leaders is attracting intense attention as investors look for coordinated signals on the future path of global monetary policy amid persistent economic uncertainties.

On the corporate front, the defense sector outperformed, driving sectoral gains amid a backdrop of geopolitical uncertainty and increased government spending expectations. Shares of key industry players such as Rheinmetall, Hensoldt, Renk Group, MTU Aero Engines, and ThyssenKrupp rose between 1% and 2.2%, benefiting from renewed investor interest and solid order backlogs.

Overall, markets remain in a holding pattern as traders digest trade-related headlines and await critical data releases and central bank insights that could shape the near-term outlook for European equities.