DAX extends record rally as Palantir reignites AI optimism
The DAX has extended its record rally above 26,000 after Palantir's stronger-than-expected results revived optimism around AI-related stocks, while investors continue to watch earnings, US data and Iran-related risks.
Chief Market Analyst
DAX extends move above 26,000
Investor appetite for equities remains intact, with the DAX extending its advance above the 26,000-point mark.
Asian markets once again focused on technology stocks, particularly companies exposed to the semiconductor and artificial intelligence sectors. Investors selectively added to positions, taking advantage of Monday's weakness to rebuild exposure to high-quality AI names.
Palantir results revive AI optimism
After the close of US trading, AI software leader Palantir delivered quarterly results that comfortably exceeded market expectations, easing concerns over lofty valuations in the sector.
The strong earnings release injected fresh optimism into AI-related stocks and provided another boost to technology sentiment heading into the European session.
European earnings calendar remains busy
European investors, meanwhile, were presented with a busy earnings calendar, including results from Continental, Zalando, Fresenius Medical Care and Evonik, while Bayer is scheduled to report later in the day.
On the macroeconomic front, attention will turn to US factory orders, the trade balance and the latest JOLTS job openings report, all of which could influence expectations for the Federal Reserve's next policy move.
Selective buying limits signs of euphoria
Market sentiment remains constructive, with investors continuing to position selectively across sectors rather than chasing the broader market.
Trading volumes, however, remain subdued, reflecting the typical seasonal slowdown of the summer months. Notably, despite the DAX's succession of record highs, there is little sign of excessive market euphoria, a factor that may provide further room for gains in the near term.
Iran remains the key geopolitical risk
The conflict involving Iran remains the dominant geopolitical risk for global markets.
Although headlines have become less frequent in recent days, developments continue to carry significant implications for energy markets and broader investor sentiment.
DAX expected to trade between 25,950 and 26,250
From a technical perspective, the DAX is expected to trade within a range of 25,950 to 26,250 points during today's session.
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