Dax aktuell: Nach Tech-Ausverkauf – Dax startet deutlich im Minus

The DAX, Germany's key stock index, experienced a significant drop of 1.7 percent on Friday, opening at 25,873 points. Tech stocks initially showed a recovery, losing between 8 and 14 percent during the day. Within the DAX, Infineon fell by 0.7 percent, while MDAX titles Aixtron and Suss Microtec gained slightly. The market's decline was driven by factors including US Midterm election results, hopes for diplomatic progress in the Iran conflict, falling energy prices, bond yields, and positive company balance sheets.

However, the day's gains were quickly erased by Wall Street's decline, primarily due to tech valuations. The index closed at 26,325 points, down 0.4 percent. Concerns over increasing political opposition to the rapid expansion of AI computing centers in the US impacted the market. Dow Jones fell by 3.4 percent on Thursday, Nasdaq by over 6 percent, and the Philadelphia Semiconductor index by nearly 12 percent.

In just 40 minutes, the S&P 500 lost $2 trillion in market capitalization, according to Kobeissi Letter on X. This rapid loss of market capitalization is one of the quickest in the history of the stock market. Asia's markets also felt the fear of stricter regulation of the AI sector following the Democrats' election victory. The Nikkei Index dropped by around 7 percent, while the broader Topix fell by 6.5 percent.

"Markets are increasingly questioning the AI trade as the Magnificent Seven's previous results fell short of growth expectations and concerns about slowing AI investments arise," analyzed Kyle Rodda, Senior Financial Market Analyst at capital.com. Meanwhile, oil prices rose again at the end of the week, with the Brent crude oil price per barrel increasing by 1.4 percent to $99.70.

Despite recent Democratic wins in US midterm elections, oil prices are still down about 15 percent on the week. The recent surge in oil prices is attributed to hope for a faster end to the conflict between the US and Iran. However, significant differences remain between the conflicting parties. Tehran demands the lifting of the American naval blockade, sanction relaxation, and the release of frozen assets before the Strait of Hormuz is fully reopened.

"It is crucial to see if the White House changes its strategy towards Iran," said Pavel Molchanov, an analyst at Raymond James, according to Bloomberg News. A lasting diplomatic agreement that leads to the reopening of the Strait of Hormuz could further reduce oil prices. However, caution remains warranted. Single-stock focus Münchener Rück: JP Morgan analysts downgraded the paper of Munich Re to "Neutral" from "Overweight." The shares fell by 1.9 percent.