Although it has still been one of the best performing developed world stock markets this year, the DAX index has come off the boil recently But its recent weakness is unlikely to continue, and the DAX is likely to surge again before the end of the year.
Germany's economy is likely to be healthier than the average in the region. And in any case, the multinationals that dominate the index generate a large part of their revenues from outside the euro-zone. As a result, their profits can be substantially boosted by a depreciation of the euro.
"Looking ahead, the prospects for monetary policy in the US and euro-zone appear consistent with a weaker euro, which we still forecast to fall to parity against the dollar this year. This should provide a boost to the DAX, which we forecast to end 2015 at 13,000." - says Capital Economics
