The DAX began the final trading day of the week on Friday with notable declines. Shortly after 9:30 a.m., the leading index was calculated at 24,810 points, a drop of 0.7 percent compared to the previous day’s closing level. Zalando, for example, saw a particularly strong decline during the market open, losing around nine percent of its value. Siemens Energy and Infineon were also down by more than two percent.
Jochen Stanzl of Consorsbank commented on the trading activity, stating that “the DAX cannot escape a new wave of sell-offs, which is sweeping across the tech sector again.” He noted that investors are struggling between the possibilities and opportunities presented by Artificial Intelligence and the risks associated with high valuations.
Although U.S. inflation data and Micron figures were not expected to spark new concerns about interest rates or AI, Stanzl finds it worryingly that investors are selling even on good news. He warned, “When good news is sold off, it can indicate a market peak and an impending correction.”
Furthermore, the recent capital increase by Alphabet and the SpaceX IPO have injected turbulence into the technology and AI rally. Stanzl suggested that “perhaps the additional stock offering that the market must absorb is actually sufficient to satisfy the current demand from investors for the AI investment theme.” This observation aligns with reports about a potential shift in the OpenAI IPO timeline.
Separately, the price of oil fell significantly. A barrel of North Sea Brent crude cost $73.50 on Friday morning, 176 cents, or 2.3 percent less than at the close of the prior trading day. In currency markets, the European community currency showed slight strength on Friday morning. The Euro was valued at $1.1381, while the Dollar exchanged for 0.8787 Euros.
