DAX continues to tumble

The DAX has headed south for the third day in a row, as traders fret ahead of the release of key US data.

The majority of the headlines covering the DAX will focus on the price action of Deutsche Bank following confirmation that it has been fined €725 million for its part in the Libor rigging scandal. The German bank has been fined almost double the next largest fine imposed by EU regulators. Of course, this may not be the end of costs associated with this case; Deutsche Bank has set aside a total of €4.1 billion to cover potential legal costs and any litigation brought against them.

Midway through the afternoon the financials in the DAX accounted for 21 points of the 111 point fall.

Although financials have helped drag the index lower, it is the basic material stocks that are doing the most damage as they account for 34 points of the fall. At the beginning of the week China posted some mildly improved manufacturing purchase managers index figures, hinting at a future return to the higher growth that the Asian powerhouse previously enjoyed. However it may be some time yet before this can be achieved.

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