Germany’s benchmark stock index entered correction territory on Wednesday, hitting a low of 9030.72 points—10.15 percent down from a high point on June 20. Strategists blamed the worsening situation in Ukraine, and weak data out of Germany.
The DAX recovered somewhat in afternoon trade, reaching 9103.28 points, but remained lower on the day.
Regarding the fall, Daniel Sugarman, market strategist at ETX Capital, told CNBC: “I think it is a combination of ramped up tensions in Russia and also to do with some pretty disappointing figures out of Germany.”
Shares were hit on Wednesday after weak manufacturing data suggested Germany’s economy was losing steam. Orders fell 3.2 percent month-on-month in June—the largest decline since September 2011 and worse than expected.
Manufacturing orders from abroad fell 4.1 percent, which the German Economy Ministry linked to sanctions against Russia amid the Ukrainian crisis. It cited “geopolitical developments and risks” as the dominant factor in the “clear reticence in orders”.
Market fears over Russia worsened on Wednesday, on reports that the country was amassing battalion groups on the Ukrainian border, potentially to invade the country. Both European and U.S. stock declined.