DAX Skids as New Fed Chair’s Rate Stance and Tech Exodus Test Key Floor at 24,600

DAX closes at 24,671, down 1.29%, as Fed Chair Warsh prioritizes price stability. Tech and cyclicals plunge; defensives rally. Key support at 50-day MA.

The German benchmark ended a bruising week on the back foot, with sellers targeting high-flying technology and cyclical names after newly installed Federal Reserve Chair Kevin Warsh poured cold water on hopes of imminent rate cuts. The DAX closed Friday at 24,671 points, down 1.29% on the day and leaving its year-to-date gain at a wafer-thin 0.54%.

The sell-off accelerated after Warsh declared price stability his top priority, a comment the market read as a green light for additional tightening this year. Interest-rate-sensitive growth stocks bore the brunt. Zalando tumbled 5.75%, while Salzgitter dropped roughly 7% in a session that punished cyclicals across the board. Porsche and Schaeffler also suffered steep losses, and technology heavyweights Infineon and Siemens Energy slid in sympathy with weakness in the US chip sector.

Defensive stocks attracted safe-haven flows. SMA Solar bucked the trend to climb over 4%, and the RENK Group and SAP posted solid gains. Henkel and utility E.ON edged higher, while Commerzbank held steady on speculation that UniCredit may build a strategic stake. The bifurcation left the DAX with a clear divide: value and defensives inching up, growth and cyclicals in freefall.

Chart watchers are now focused on the 50-day moving average at 24,603 points, which the index flirted with during Friday’s session. A decisive breach would open the path toward the 200-day line near 24,277, with the next major floor at 23,900. On the upside, resistance at 25,100 blocks any rapid rebound. The relative strength index stands at 48, indicating the market is not yet oversold but momentum is fading.

Beyond equities, investors sought safety in gold, which rose to $4,082 per ounce. Brent crude eased to around $72 a barrel despite fresh geopolitical tensions in the Gulf. All eyes now turn to a busy week of US data, including employment figures, retail sales, and June inflation prints. If the numbers confirm sticky price pressures, the pressure on the DAX to test its technical support levels is likely to intensify.