Dow Jones and DAX similarities

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Michael Höhne's picture
Michael Höhne
Status: Silver Member (Offline)
Joined: Nov 16 2008
Posts: 119
Dow Jones and DAX similarities

I have mentioned this in another post and closely watched it for years: the DAX is following the Dow Jones as soon as NYSE opens. Here's today's chart:


And here's a two-year chart:

And a 10-year chart:


The last major differences in the general performance were between 2000 and 2002, where the DAX gained and lost value, while the Dow Jones more or less stayed at the same level. But what totally confuses me is the almost congruent line since 2006 and the identical pattern since mid 2001.

Of course globalization has an effect and therefore these indexes have to be related. But now it seems as if they are merging into a single index.

I take it as it is, but I don't like the figures.


Dogs_In_A_Pile's picture
Status: Martenson Brigade Member (Offline)
Joined: Jan 4 2009
Posts: 2606
Re: Dow Jones and DAX similarities

Michael -

Interesting to see your perspective on this one.  We watch futures and foreign bourses for indicators as to how US Markets are going to open and respond.  Particularly over a three day weekend or around US holidays - we watch to gauge how the other markets are digesting the various foolish things the US government is doing wrt the US economy. 

Foreign markets have the chance to respond to the news before our markets and generally what the CAC and DAX and other markets do on a given day will affect what the Dow does.

In that sense I think the Dow follows the DAX - or at least confirms that the news that moved the DAX is likely to affect the Dow the same way.

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