The Dax saw a significant decline at the close of the week. The index settled at 25,818 points during trading on Xetra, marking a loss of 0.9 percent compared to the previous day’s close.
Leading the stock movement board just before closing were Bayer shares, which experienced a robust jump of over five percent, followed by Scout24 and Beiersdorf. Conversely, at the bottom of the list, Siemens Energy shares plummeted by more than six percent, trailed by Infineon and Deutsche Bank.
Andreas Lipkow, Head Market Analyst at CMC Markets, noted that investors are increasingly remaining on the sidelines before the weekend, though they are not completely abandoning the stock markets. He cautioned that turbulence could be expected in the US markets, as investors contend with recent earnings reports from Amazon and Intel and must adjust their portfolios accordingly. Lipkow stated that nervousness is particularly growing within the technology sector.
The US market’s previously “most important support pillar” is now showing signs of stress. According to the analyst, following Meta Platforms and Alphabet, Amazon has also failed to meet high investor expectations. This puts three major US hyperscalers under pressure. The colossal investments these companies are making in data centers and AI infrastructure raise increasingly pressing questions about their real-world profitability. While investors do not fundamentally doubt the potential of artificial intelligence, they are skeptical about how quickly these billions of dollars spent will actually translate into returns.
Adding to these concerns are persistently high energy prices and their resulting inflationary effects. Lipkow explained that central banks face an almost unsolvable dilemma: further interest rate hikes might slow consumption and investment activity, but they would not alter the geopolitical origins of high energy costs. In the worst-case scenario, monetary policy could weaken the economy even further without decisively reducing the core price pressure.
However, recent US inflation data provided some relief. The consumer prices rose in October at a slower pace-2.8 percent-than the forecasted 3.0 percent. The analyst believes this news should initially instill some confidence in investors and reduce immediate fears of further restrictive monetary tightening.
In currency markets, the European common currency weakened on Friday afternoon. The Euro traded at $1.1163, meaning the dollar bought for 0.8958 Euros.
Meanwhile, the price of gold experienced a strong downturn, falling by 3.1 percent to $3,900 per troy ounce in the afternoon, translating to €112.31 per gram. Conversely, crude oil prices climbed sharply. Brent North Sea crude reached $117.60 per barrel around 5 PM German time on Friday, representing a 2.4 percent increase from the previous trading day’s close.
