Philip Papageorgiou

The DAX has opened significantly higher following the Federal Reserve's delivery of its first interest rate hike since 2023. Although the Fed signaled further tightening, the market reaction was surprisingly positive, as much of the hawkish expectation had already been priced in. Attention now shifts to the 25,900–26,000 point range, which will likely determine whether the current recovery evolves into a new upward wave or remains merely a short-covering rally.

The DAX correction now has little to do with corporate news. Rising oil prices, higher bond yields, and the prospect of further interest rate hikes are dominating market activity. Following the strong US PPI report, all focus is now on today's US CPI. The figures could determine whether the current risk-off phase continues or whether the markets can launch a short-term relief rally.

Earnings season has taken a back seat for now. Instead, rising oil prices, higher bond yields, and renewed inflation concerns are shaping market sentiment. Brent crude is trading above $100 per barrel again, while the ECB is poised for another interest rate hike. Investors are now focusing on Christine Lagarde's press conference and today's US producer prices for clues about the future direction of interest rates on both sides of the Atlantic.

The DAX has fallen for three consecutive sessions after reaching a record high on 28 August. Rising oil prices and Bund yields are now challenging the rally, while German business confidence and manufacturing data offer a more constructive signal for the domestic economy.

The FTSE 100 enters the final trading session of August after falling 0.8% on Thursday. Oil, gilt yields and sterling remain critical for the index, but the bigger question is whether investors are underestimating the impact of global rate expectations as September approaches.

The DAX starts close to its record high. Nvidia, interest rates, oil and Jackson Hole are driving trading. Next week, inflation, PMIs and the US labor market will take center stage.

Bitcoin delivered its strongest weekly performance in years as renewed ETF inflows, improving liquidity expectations and a weaker US dollar drove a powerful recovery across crypto markets. Ethereum and several major altcoins outperformed, highlighting a broader return of risk appetite. The focus now shifts to the key $80,000 level, where investors will look for confirmation that institutional demand can sustain the rally.

The DAX remains within reach of a new record high, supported by strength in banks, defence stocks and energy infrastructure names. Improving German and eurozone growth data are providing a supportive backdrop, while softer US inflation and weaker labour-market data have eased concerns about further Fed tightening. However, weakness across autos and chemicals suggests participation remains narrow, leaving the index facing an important technical test near record territory.

US markets begin the week with a constructive tone after a surprisingly weak July jobs report sharply reduced expectations for a September rate hike. Technology stocks remain in the spotlight following strong results from TSMC and continued confidence in AI infrastructure spending, while investors increasingly focus on upcoming US inflation data. With the S&P 500 at record highs and Treasury yields falling, the next move depends less on labour market weakness and more on whether inflation continues to cool.