The German stock market is facing challenges as the DAX attempts to sustain its position above the 26,000-point threshold. By midday on Friday, the leading index had expanded its losses, trading at 25,830 points, which represents a decline of 0.8 percent. This marks a reversal from the previous session, where the index climbed to an eight-week high, closing up approximately 1.3 percent at 26,040 points. That closing level was the highest since early September, with the absolute gain of 335 points being the largest increase recorded since July.
Although the DAX last traded above the 26,000 mark in early September, subsequent profit-taking has frequently interrupted upward momentum. If the index manages to close positive on Friday, it would achieve five consecutive trading days in the green, a feat not seen since January. However, Thomas Altmann, a portfolio manager at QC Partners, suggests that achieving such a "perfect week" will be difficult.
The primary concern driving market hesitation revolves around artificial intelligence (AI). Major US corporations, including Alphabet and Amazon, are investing billions of dollars into new data centers for AI applications. Investors remain skeptical about whether these substantial expenditures will yield returns. Following the quarterly reports from these two companies, there was a sell-off in technology stocks. Despite this broader trend, the DAX has thus far managed to hold its ground against the negative sentiment.
Sources: Handelsblatt.