As the trading week concluded, the DAX experienced a significant decline. At the close of trading on Xetra, the index stood at 24,671 points, marking a 1.3 percent drop compared to the previous day’s closing figure. After a weak start, the DAX continued to shed value.
Andreas Lipkow, Chief Market Analyst at CMC Markets, noted that recent news has intensified investor skepticism regarding whether consumers will continue to accept the price hikes implemented by technology giants. He pointed out, “Apple is now passing along the increased semiconductor costs to its customers for the first time.” Lipkow explained that the current high profits and margins of chip companies such as Micron Technology were previously possible because corporations like Apple were still willing to cover these rising costs. However, he warned, “If the customer no longer pays the higher prices, the chain reaction will pull back and severely impact the highly valued semiconductor industry.”
This doubt was reflected in the DAX today by the fall in Infineon’s share price, and Siemens Energy also saw selling pressure. Investors chose to position themselves in the defensive sectors ahead of the weekend, preferring the stocks of utility providers and insurance companies. The analyst added that in the broader market, every negative piece of news is currently being used as an opportunity to take profits, suggesting “that the stock market might be heading toward a period of consolidation.”
For stock movements, Beiersdorf, SAP, and Henkel led the list of top performers in Frankfurt. Conversely, the weakest companies were Infineon, Siemens Energy, and Zalando.
In the commodity markets, the price of natural gas increased. A Megawatt-hour (MWh) of gas delivered in July cost 41 Euros, an increase of 1 percent from the day before. If this price level remains stable, it translates to a consumer price of at least nine to eleven cents per kilowatt-hour (kWh), inclusive of taxes and ancillary costs.
Conversely, oil prices dropped sharply. Brent crude oil, sourced from the North Sea, traded at US$71.59 on Friday afternoon at approximately 5 PM German time. This represented a decrease of 367 cents, or 4.9 percent, compared to the close of the previous trading day.
Finally, the European common currency strengthened on Friday afternoon. The Euro exchanged for US$1.1405, meaning the dollar was purchased for 0.8768 Euros.
