The DAX began the Friday morning trading session in decline. The main index was calculated at around 24,791 points by 9:30 AM, representing a drop of 0.5 percent compared to the close of the previous day. Among the top performers were shares of Deutsche Telekom, Eon, and SAP, while Siemens Energy, Siemens, and Infineon recorded the lowest gains.
According to Andreas Lipkow, Chief Market Analyst at CMC Markets, the downward trend on the stock market is continuing. He noted that selling pressure persists within the technology sector, particularly concerning semiconductor stocks. This outflow of investment is driven by a “toxic mix” of anxieties over the potential fallout from an escalating Iran-Iraq conflict and concerns regarding rising interest rates.
The analyst warned that the combination of continued robust economic growth in the United States and the threat of inflation fueled by rising oil prices could force central banks to adopt a more restrictive monetary policy sooner than previously anticipated or priced in. Lipkow added that the increasing uncertainty is creating very fragile sentiment for the stock market, noting that the high valuations of semiconductor stocks have left investors particularly nervous.
Furthermore, Lipkow cited the potential for negative surprises during the ongoing US reporting season. He explained that even strong results from technology companies are often not enough to maintain momentum, leading to subsequent selling in those sectors, which is putting downward pressure on stocks during the already thin summer trading period.
Today’s trading session will also be focused on upcoming US corporate earnings and macroeconomic data, including figures related to construction starts and industrial production. Recent US real estate data has already indicated a stressed property sector.
In currency markets, the Euro strengthened slightly on Friday morning, costing 1.1447 US dollars, while the Dollar matched this by trading at 0.8736 Euros. Meanwhile, oil prices rose; a barrel of North Sea Brent crude cost $84.72 as of 9 AM Central European Time, which was 0.6 percent (49 cents) higher than the previous closing level.
