Finally a bit of tariff angst starts to bite on the DAX

As many of you surely know, the US president threatened 25% tariffs on Europe yesterday. Somehow that seemed to get ignored by the markets. Perhaps that was due to the fact that his latest salvo on that yesterday was deemed to be little more than an opening gambit, to start negotiations. Well, it might be, but as more detail emerges the markets are fretting a bit more now, especially the auto and pharmaceutical sectors, as that is where the Trump focus seems to be now. So, this has pushed German auto stocks steadily lower over the past couple of hours and they are all still falling further into the red. That in turn has sent the DAX lower now. Of course earlier we saw a new record for the index when it actually peaked at 22,935. It has also weighed on the EUR/USD. The DAX has just now fallen back below the 22,800 and right at this moment in time, given its massively overbought position, it would seem unwise to rule out a deeper correction this time. We shall just have to see on that as the day unfolds