AI concerns and rising costs weigh on the DAX
The DAX is expected to open at around 25,250 points as concerns over elevated valuations and the financing of the AI boom continue to grow. Semiconductor and data-centre stocks faced renewed selling across Asian markets. Investors increasingly question whether major technology companies' substantial investments can generate returns within a reasonable timeframe. Even the Chinese central bank's decision to leave interest rates unchanged failed to stabilise sentiment.
Stronger-than-expected German producer prices for September are adding to the pressure. Renewed cost increases leave companies facing an uncomfortable choice: absorb the impact through lower margins or pass costs on to customers, potentially fuelling inflation. Neither outcome supports equities. Rising costs combined with doubts over earnings growth leave markets particularly vulnerable.
Earnings and key technical levels in focus
Today's ZEW economic sentiment index and US housing data could provide fresh direction, although the ongoing earnings season is likely to carry more weight. Results and investment outlooks from Tesla, SpaceX and Meta Platforms will be closely watched. Investors want concrete evidence that heavy spending on artificial intelligence remains economically sustainable. Further disappointments could intensify selling across technology stocks.
From a technical perspective, the DAX is expected to trade within a range of 24,950 to 25,350 points today, bringing the psychologically important 25,000-point mark back into focus. While doubts over the AI boom persist and inflationary pressures build, attempts at a recovery are likely to face a difficult test.
