Friday 16 January 2015 10:11 am

German DAX index hits new all time high

The German DAX index hit a record high of 10,068 points at 3pm today – 35.6 points higher since yesterday's close.

The rise indicates that investors are still confident about Germany's stock, despite yesterday's surprise announcement by the Swiss National Bank (SNB) that it was removing the currency cap on the Swiss franc.

Market analyst Michael Hewson broke the news via a tweet:

New all time high on DAX

— Michael Hewson 🇬🇧 (@mhewson_MCH) January 16, 2015

Yesterday's announcement sent European markets into shock yesterday, with Swiss shares dropping by as much as 10 per cent at one point.

The cap, which was introduced in 2011 to limit the swiss franc's value against the euro, is viewed as important for encouraging competition across Europe. But yesterday, the SNB said the cap was no longer justified, and this could have negative repercussions for the economy.

A country's exports become more or less expensive depending on its currency strength, and products made by Swiss businesses such as Swatch and Nestle could become more expensive as a result.

Germany's index is not the only one to have performed well today – the UK's FTSE 100 was up at 6,528 by 3pm, which is an increase of 29.31 points compared to yesterday, while France's CAC 40 was 42,3 points higher at 4,365 points.

Continuing the trend

The German DAX has been having a good spell recently, driven by hopes of an improved stimulus program from the European Central Bank (ECB) in the form of bond-buying.

Its strong performance also reflects Germany's position as the Eurozone's economic powerhouse, with data this month showing how German consumer morale had reached its highest level in nearly six and a half years.