DAX Near 26,000 as Nasdaq Selloff Hits Sentiment

The immediate trigger came from the Nasdaq 100, which fell 3.46% on Friday in its steepest one-day drop since early June, as investors reacted to negative comments from Amazon and Intel and to fresh warnings around heavy AI outlays. Alphabet had already unsettled traders a day earlier by fanning fears that spending on artificial intelligence could run ahead of near-term returns. The Nasdaq’s decline pushed it more than 10% below its October high at one point, putting it in correction territory, while the S&P 500 fell 1.82% and the Dow Jones Industrial Average lost 1.09%.

For Europe, that matters because the Dax has become more sensitive to the same growth and semiconductor themes that drive US megacap technology. A renewed de-rating of AI winners would ripple through European chip suppliers, industrial exporters and broader risk assets, even though Germany’s index is not as tech-heavy as the Nasdaq. JPMorgan’s strategists remained constructive on semiconductors, suggesting the current pullback may still be a correction within a longer AI investment cycle rather than the start of a more durable unwind.

The Asian session offered a partial counterpoint. Tech-heavy benchmarks in Japan and South Korea recovered from early weakness, while Chinese shares also firmed, with the CSI 300 up 0.9% and Hong Kong’s Hang Seng 0.7% higher. That helped steady European futures, but it did not erase the message from Friday: investors are demanding clearer evidence that AI capex will translate into earnings, not just higher valuations.

Oil added another layer of caution. Brent and WTI both fell on Monday after jumping Friday on fears of a possible renewed US military strike on Iran. That took some pressure off inflation expectations, but it also underscored how quickly geopolitical risks can reprice energy and broader market sentiment.

For Dax investors, the near-term question is not whether German equities can hold a mild positive bias, but whether they can do so without help from US technology. A sustained correction in the Nasdaq would likely cap upside in Frankfurt, even if domestic corporate earnings and ECB policy remain supportive. If the US tech rout stabilizes, the Dax may extend its recent gains; if not, the benchmark’s move back above 26,000 could prove fragile.