Business · Markets · 12 hrs ago
DAX rises as rate and AI investment worries ease
Germany’s DAX rose nearly 1% on Friday, closing at 25,622.61 points and lifting its weekly gain to more than 2%.
Investors had worried that unexpectedly high US inflation could prompt the Federal Reserve to raise interest rates again in October, making borrowing more expensive.
Fed chief Kevin Warsh did not discuss monetary policy in a speech, lowering market expectations of an October rate rise; he also said AI investment was supporting the US economy.
Shares in Volkswagen, BMW and Mercedes-Benz gained after France and Germany agreed on a shared approach to the future of combustion engines in the EU.
The rebound does not mean the wider risks have gone away: investors remain concerned about AI spending, energy prices and geopolitical tensions.
The next test is companies’ third-quarter results, which investors will watch for signs of how businesses are performing.
The DAX rose 0.95 percent to 25,622.61 points on Friday as worries about interest rates and artificial intelligence investment eased.
The index gained more than two percent over the week and moved above its 100-day moving average.
A speech by US Federal Reserve Chair Kevin Warsh reduced market expectations of an October rate increase, while he said AI investment was supporting the US economy.
A German-French agreement on the future of combustion-engine cars in the EU and strong company results also supported shares.
Analysts cautioned that uncertainty remained, including concerns about energy prices, supply chains and the outlook for a year-end rally.
- Who
- The DAX and other German shares rose. Investors had been concerned about interest rates and the returns from AI investment.
- What
- The DAX closed 0.95 percent higher at 25,622.61 points.
- When
- Friday, October 16, 2026.
- Where
- Germany's stock market.
- Why
- Rate-rise concerns eased after Fed Chair Kevin Warsh spoke without addressing monetary policy specifically. A German-French car agreement and strong company results also supported shares.
Market optimists
Cautious analysts
Effect of Warsh's speech
Market optimists
Thomas Altmann said Warsh had restored optimism to markets. Warsh said AI investment was strongly supporting the US economy.
Cautious analysts
Timo Emden said it remained unclear whether the speech could provide a solid basis for a year-end rally.
Market outlook
Market optimists
The DAX's more traditional industry mix offered some protection while technology shares were under pressure, according to analyst Salah-Eddine Bouhmidi.
Cautious analysts
Andreas Lipkow warned that high energy prices and disrupted supply chains remained significant burdens.
Higher-than-expected US inflation raised concerns that the Federal Reserve might raise its key interest rate again in October.
Kevin Warsh spoke without addressing monetary policy specifically and said AI investment strongly supported the US economy.
The DAX rose 0.95 percent to 25,622.61 points, bringing its weekly gain to more than two percent.
- DAX close
- 25,622.61 points
- DAX daily gain
- 0.95 percent
- DAX weekly gain
- More than 2 percent
- MDAX close
- 30,656.65 points, up 1.46 percent
- Rheinmetall share gain
- 6.3 percent
- Nordex share gain
- 12.3 percent
3 sources
What people are saying
Kevin Warsh gives the markets their optimism back
I would say the emergence of this new technology is probably the most significant change for the US and global economy in my lifetime
Whether the rhetorical tailwind creates a solid foundation for a year-end rally remains questionable
High energy prices remain a considerable burden given the military conflicts in the Middle East and disrupted supply chains