The main drivers behind the Japanese market’s growth are AI-driven optimism, strong corporate earnings, a weak yen, and capital inflows into Japanese equities amid corporate governance reforms. In May, #NIKKEI reached new all-time highs and gained around 24% year-to-date. Against this backdrop, #DAX30 and #CAC40 appear weaker: Germany’s #DAX30 is held back by sluggish economic growth, high energy costs, and risks of ECB rate hikes, while France’s #CAC40 is pressured by a slowdown in the luxury sector and its dependence on demand from China and the Middle East.
Japanese market:
German market:
French market:
FreshForex analysts note that the divergence between #NIKKEI and European indices is only beginning to unfold. The Japanese market remains in a stronger position, with a weak yen and ongoing reforms continuing to provide support. Any short-term pullback in #NIKKEI may be seen as a buying opportunity. At the same time, #DAX30 and #CAC40 look more vulnerable — high energy costs, ECB rate risks, and weak demand for luxury goods are weighing on prices. On upward rebounds, these indices may present selling opportunities. Three indices are moving in different directions — all that remains is to choose the right entry point.
Japanese market:
- Growth factors: #NIKKEI is supported by AI enthusiasm, strong earnings from tech and industrial companies, a weak yen, and foreign capital inflows into Japanese equities. Additional support comes from corporate governance reforms and share buybacks.
- Downside factors: Pressure may increase if the yen strengthens sharply, profit-taking begins in the AI sector, or the Bank of Japan tightens policy. Rising energy prices and geopolitical risks also pose threats.
German market:
- Growth factors: #DAX30 may recover with improved industrial demand, a weaker euro, and rising export orders. Support may also come from the banking and defense sectors.
- Downside factors: The index is constrained by Germany’s weak economy, high energy costs, and the risk of ECB rate hikes. Additional pressure may come from weak demand in China and the U.S.
French market:
- Growth factors: #CAC40 may gain support if demand for luxury goods recovers, conditions in China improve, and tourism flows increase. Easing geopolitical tensions would also be positive.
- Downside factors: The main risk is a continued decline in demand for luxury goods and cautious consumer behavior. The index is also pressured by high energy costs, a strong euro, and potential ECB tightening.
FreshForex analysts note that the divergence between #NIKKEI and European indices is only beginning to unfold. The Japanese market remains in a stronger position, with a weak yen and ongoing reforms continuing to provide support. Any short-term pullback in #NIKKEI may be seen as a buying opportunity. At the same time, #DAX30 and #CAC40 look more vulnerable — high energy costs, ECB rate risks, and weak demand for luxury goods are weighing on prices. On upward rebounds, these indices may present selling opportunities. Three indices are moving in different directions — all that remains is to choose the right entry point.
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More analytical information and promotions on FreshForex website cutt.ly/LrP6j9qD
Clause de non-responsabilité
Les informations et publications ne sont pas destinées à être, et ne constituent pas, des conseils ou recommandations financiers, d'investissement, de trading ou autres fournis ou approuvés par TradingView. Pour en savoir plus, consultez les Conditions d'utilisation.