German election

European markets dropped their air of complacency after Eurosceptic parties outshone the establishment in Italy's general election

The German election may have had a muted impact on the markets even if failed to deliver Angela Merkel the share of the vote that she had wanted, and the rise of the AfD Far Right party spooked some European political commentators.

The markets’ initial reaction to the outcome of the German federal election has been negative. The German DAX futures and EUR/USD both gapped lower at the open overnight as Angela Merkel’s achievement of securing a fourth term at the helm of the German parliament was overshadowed by the stronger-than-expected showing from the right-wing AfD party.

The euro has opened 0.4% lower in early trading on Sunday evening as the market digests the results from the German election. Although Merkel will become Chancellor for her fourth term, Merkel’s party - the CDU - saw its vote share slip by approx. 8%, about the same as the Far Right’s AfP’s vote share increased.

It would be a mistake to underestimate the importance of the vote for European markets in the years ahead.

Unless we see a shock outcome in the German elections on Sunday, the DAX looks set to expand further to the upside in the short term outlook.

There has been an interesting divergence of late between the performance of the Dax and the FTSE 100. The two have diverged sharply in recent days, as you can see in the chart below, with the Dax surging ahead, while the FTSE 100 has been in the doldrums.

On Sunday 25th September Germany will go to the polls. Chancellor Angela Merkel is widely expected to win her fourth term in power, Oddschecker has Merkel’s victory at a 97% probability. Get our take on what this means for markets.

The German election on 25th September is starting to grab investors’ attention now that it looks increasingly likely that Angela Merkel is set to win her fourth term as a coalition leader. This could be good news for German stocks.

The system by which Germany selects the members of the country’s parliament, the Bundestag, is vastly different to the electoral process in the UK. In fact, it’s so complicated that many Germans cannot make head nor tail of it

A few shocks have emerged from the raft of elections across Europe over the past year or so

European stock indices stormed higher yesterday and have extended their gains this morning ahead of the European Central Bank rate decision and press conference today.