After three strong years on the stock market, investors are threatened with trouble in 2026.
Because the Iran war is driving up the price of oil to such an extent that the specter of inflation is once again being avoided in this country. Unpleasant memories of 2022 are brought back, when the start of the war in Ukraine sparked an energy price rally that led to a massive spike in inflation. At that time, the central banks were forced to counteract this with significant interest rate increases. But that had a toxic effect on the German leading index DAX, which ended the year with a significant loss.
Experts are now warning of a similarly drastic development in 2026 if crude oil prices remain at a high level for a long time due to the war in the Middle East. For the head of capital markets and strategy at Dekabank, Joachim Schallmayer, a barrel (around 159 liters) of the North Sea Brent variety would have to cost over 100 US dollars for several months in order to force the central banks to drastically increase interest rates.
High interest rates have a negative impact on the stock market in two ways. On the one hand, they make investments and loans more expensive, which dampens economic growth and correspondingly reduces companies’ profit prospects. On the other hand, high interest rates increase the attractiveness of bonds compared to stocks.
In view of the Iran war, the DAX has already moved significantly away from its record high of almost 25,508 points, which was reached in January. Calculated since the beginning of the year, there has been a minus so far. However, experts still expect that the consequences of the Iran war for the stock markets will remain manageable. According to analysts from the Federal Association of Public Banks (VÖB), what is crucial for the further development of the oil price and thus the stock market is how long possible disruptions to oil supplies – mainly through the Strait of Hormuz – last and whether critical infrastructure is affected.
According to the VÖB experts, there is currently a tailwind for the stock markets from the global economy. Impulses from higher government spending on infrastructure, security and defense also had a positive effect. The expansionary fiscal policy is already “bearing its first fruits,” emphasized Birgit Henseler from DZ Bank.
In this environment, further increases in company profits are still possible for the VÖB analysts. They could also benefit from structural trends such as the innovation cycle around artificial intelligence, which leads to high investments in technology infrastructure, data centers and semiconductors.
Investors may be faced with the question of whether they should keep quiet in the current environment or take action – be it to protect their portfolios or even to profit from current market fluctuations. The advice from consumer advocates is mostly clear: it’s best to stay calm and sit out phases of loss by having a long investment horizon. “Crashes are just as much a part of stock investments as dramatic increases. After all previous slumps, share prices have risen higher than before,” says Stiftung Warentest.
Nevertheless, Konstantinos Liolis from asset manager Proaktiva warned against carelessness: “Keeping calm doesn’t mean being passive. It means having been active in advance – in defining risk tolerance and the portfolio structure.” Only those who have already done this homework months before do not have to do anything in the crisis.
Asset manager Ortay Gelen from Axia Asset Management added: “For many investors, it makes sense to clearly separate a long-term core portfolio from a short-term trading portfolio.” In this way, the strategic portfolio structure is maintained, while smaller amounts can be used specifically for tactical opportunities. But anyone who wants to take action should be aware that short-term speculation requires a different approach than long-term investing.
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— By Lutz Alexander, dpa-AFX —
FRANKFURT (dpa-AFX)
