DAX keeps record high in sight as investors avoid profit-taking
The DAX remains within reach of its record high just below 26,450 points as investors continue to bet on an extension of the rally that began at the start of August. Geopolitical risks around Iran and the Strait of Hormuz are still having little impact, while AI enthusiasm, hopes of a European recovery and tomorrow's US inflation data remain in focus.
Chief Market Analyst
DAX stays close to record territory
The DAX remains magnetically drawn towards its record high of just under 26,450 points, preventing any significant wave of profit-taking.
Investors in Frankfurt continue to bet on an extension of the rally that began unexpectedly at the start of the month. Uncertainty surrounding the Iran conflict and the Strait of Hormuz continues to have remarkably little impact on Germany's benchmark index.
AI momentum supports Asian markets
Asian markets provided a broadly supportive backdrop for technology stocks overnight. While the Tokyo Stock Exchange remained closed for a public holiday, indices in South Korea and China posted modest gains.
The ongoing AI boom continues to fuel investor enthusiasm and support semiconductor stocks.
Recovery hopes cushion European equities
In Europe, hopes of a sustainable economic recovery are increasingly underpinning equity markets at current levels.
The combination of continued demand for technology stocks and renewed interest in old-economy sectors has created a solid foundation for the recent upward trend. Rising oil prices are still being viewed as a temporary phenomenon and have so far had only a limited impact on sentiment. Brent crude remains just below $90 per barrel amid difficult negotiations between the United States and Iran.
US inflation data moves into focus
Attention is therefore turning to tomorrow's US consumer price data. The key question is when higher energy prices will begin to feed more noticeably into inflation.
Such a development would increase pressure on central banks and reopen the door to further interest rate hikes. At the same time, this uncertainty may itself be supporting the current record run: investors who had remained cautious because of monetary policy concerns are gradually returning to the market as those risks have yet to materialise.
DAX expected to remain subdued
Today's session is likely to remain relatively subdued, with few major catalysts on the economic calendar. The main points of interest will be the ADP employment report and US existing home sales.
From a technical perspective, the DAX is expected to trade within a range of 26,000 to 26,400 points during today's session.
DAX starts the week quietly as policy and geopolitics stay in focus
The DAX traded in a narrow range of just over 100 points on Monday as investors slipped back into summer mode after the index's recent record-breaking run. Attention remains focused on the Iran conflict, energy prices and monetary policy, while AI stocks, precious metals and rare earths continue to attract selective interest.
DAX still searching for direction as Middle East talks remain uncertain
The DAX is still searching for direction as weaker US labour market data support risk appetite but Middle East talks remain fragile. Investors are also weighing higher oil prices, Japanese trade data and an earnings season that has so far remained broadly encouraging.
DAX lacks momentum ahead of the weekend as Middle East remains the key risk
The DAX lacks momentum ahead of the weekend as Middle East uncertainty keeps investors cautious. Strong Chinese exports and a modest improvement in German exports were offset by higher imports, while Allianz and Munich Re came under pressure after disappointing results.