Market report: Investors shy away from risk ahead of US midterm elections

The leading German index fell by one percent to 25,710 points in early trading. It has slipped below its previous day's low and is moving further away from the 26,000 point mark. At the beginning of the week, the DAX was still 0.6 percent higher at 25,981 points.

In addition to the US midterm elections, the situation in the Middle East is coming back into focus: According to media reports, the US military has again attacked targets in Iran. “The situation in Iran is escalating again,” wrote market observer Thomas Altmann from asset manager QC Partners. "The US and Iran are attacking each other." Relatively little is known yet, but the classic pattern of rising oil prices and falling share prices can already be seen on the stock exchanges.

The markets had just started to price in a more diplomatic course, but now the mood has changed again, said Tim Waterer, chief market analyst at KCM Trade.

But the topic of the day is the midterm elections. This is where it will be decided whether the Democrats can wrest control of Congress from President Donald Trump's Republican Party. Polls suggest Democrats will win the House of Representatives, while the outcome in the Senate is more unclear.

Many investors fear that the USA is planning a major attack on Iran after the elections, with dire consequences for the raw materials market and the global economy. However, Trump recently answered "no" when asked by reporters whether he would consider attacking Iran after the midterm elections. He also believes that Iran wants to reach an agreement and that such an agreement “could come about.”

The accounting season also remains a key factor for price movements. Will the AI ​​bet pay off? This is one of the questions that investors are currently most concerned about. That's why they pay particular attention to the results of US tech companies. On Monday after the US stock market closed, Apple had its books looked at.

Investors saw light and shadow. iPhone sales and total group revenues reached record levels for a September quarter. The bottom line was that more than $30 billion was left hanging. But what is traded on the stock market is primarily expectations for the future: investors reacted with disappointment to the forecast for the current quarter.

Many companies on the German stock market also have their books examined. Today it was the turn of Lufthansa and Bayer, among others. The sharp rise in fuel costs is slowing the airline's growth. Nevertheless, Lufthansa earned more than expected.

Thanks to increased ticket prices and a booming freight business, profits rose to 1.3 billion euros. That's 30 percent more than a year before. The board of directors is again dampening the profit forecast for 2026. The operating profit adjusted for special items (adjusted EBIT) should only reach 1.7 to 2.0 billion euros instead of 1.7 to 2.2 billion.

At Bayer, the pharmaceutical division is driving growth. Group sales climbed by a good four percent to over ten billion euros. The bottom line is that Bayer recorded a loss of around 670 million. A year ago the loss was almost one billion euros. The group is raising its annual targets.