Germany’s DAX hits record high on AI optimism, healthy earnings
The blue-chip index rose more than 1% in morning trade, crossing the 27,000-point mark for the first time.
FRANKFURT: The DAX index of Germany's leading companies breached the 27,000 mark for the first time on Thursday, propelled by enthusiasm surrounding the artificial intelligence revolution and strong corporate profits. The index climbed by more than 1% in early trading, closing at 27,001 points. Industrial major Siemens surged over 4% after disclosing record earnings driven by robust demand for data centers.
Online apparel company Zalando skyrocketed 4%, continuing a rise sparked by results that surpassed expectations earlier in the week. European markets also experienced gains, with Paris surging around 0.5% and London up by approximately 0.2%. CMC Markets analyst Andreas Lipkow highlighted the exceptionally favorable conditions for the DAX, citing declining energy costs, reassuring quarterly reports, and optimism over a sustainable economic rebound as key factors.
He added that the year-end rally appeared set to persist. A government-appointed panel of economists recently revised upward their growth projection for Germany this year to 1.3%, the latest optimistic forecast for Europe's largest economy. However, Lipkow cautioned that there were uncertainties for the markets due to the ongoing controversy involving AI behemoth Nvidia.
The company's founder, Jensen Huang, is grappling with a board rebellion amidst an investigation into an alleged affair with a woman suspected of espionage for China. Allegations of a potential successor to Nvidia's leadership are casting a shadow over the stock.
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