Weekly Outlook: “High Oil Prices Are Weighing on the Market Again”

Last week's record-breaking run is over for now. That's because a new U.S. military strike in the Strait of Hormuz has caused oil prices to rise sharply again. Yet economically speaking, things in Germany don't look so bad anymore.

August 31, 2026. FRANKFURT (Deutsche Börse). Sentiment has cooled off following Friday’s new DAX record. This is because the price of Brent crude has risen above $90 per barrel due to renewed fighting in Iran. On Thursday, strong quarterly results from Nvidia and the company’s optimistic outlook had boosted AI stocks and the markets as a whole. In addition, the highly anticipated speech by Federal Reserve Governor Kevin Warsh on Friday at the central bankers’ conference in Jackson Hole was generally well received: Warsh emphasized the risks of inflation. As a result, an interest rate hike in September is now considered more likely. On the other hand, Warsh—who was at times viewed as a puppet of U.S. President Trump—gained credibility as a guardian of price stability.

The DAX (DE0008469008) stands at 26,468 points on Monday morning, down from Friday’s all-time high of 26,659 and 26,559 at the close of trading. The Stoxx Europe 600 (EU0009658202) is also slightly below its record high. The sharp rise in the prices of gold and Bitcoin has not continued. After surpassing $4,660, a troy ounce of gold is now trading at $4,434 again. Bitcoin, after briefly exceeding $80,000, is currently trading below $78,000.

“A Shadow Over the AI Boom”

According to LBBW analyst Andreas da Graca, the AI story is indeed driving the U.S. tech markets. In Europe, however, it cannot offset the pressures caused by geopolitical risks, trade conflicts, and concerns about the economy and inflation. Furthermore, the AI boom is beginning to cast its first shadows. “For example, Nvidia is said to have paused parts of a financing model for smaller AI cloud providers,” explains da Graca. There are fears that credit support and the leasing back of computing capacity are artificially propping up demand.

“A Lousy Week for Doomsayers of German Industry”

Meanwhile, the first encouraging signs are coming from the German economy. “It was a lousy week for doomsayers of German industry,” says Ulf Kraus of Helaba. Following the rise in the purchasing managers’ indices, the ifo Business Climate Index—the next key sentiment indicator—has also risen. The indicator for the manufacturing sector even reached its highest level in over three years. In addition, GDP growth in the second quarter was revised upward from 0.2 to 0.3 percent. “It’s actually amazing how robustly the industry has weathered the war in Iran so far.”

Only a few corporate earnings reports remain

The highlight of the coming week is likely to be Friday’s U.S. jobs report, which is expected to provide insights into the future trajectory of U.S. interest rates. As the earnings season winds down, a few stragglers are still set to report their results. “Whether the market can reach new all-time highs will likely also depend on how investors interpret the financial results and outlooks from Dell and Palo Alto (both on Tuesday) as well as HP and Broadcom (both on Wednesday),” says Alexander Krämer of Commerzbank.

Key Economic and Business Data

Monday, August 31

2:00 p.m. Germany: August consumer prices. DekaBank expects a 0.4 percent increase from the previous month, resulting in a 3.1 percent year-over-year increase.

Tuesday, September 1

11:00 a.m. Eurozone: August consumer prices. DekaBank estimates that inflation in the eurozone likely rose to 3.3 percent. The main driver of this is likely once again the sharp rise in energy prices. It expects the core inflation rate to remain unchanged at 2.5 percent.

Thursday, September 3

Index adjustments in the DAX family: Index reviews take place four times a year, on the third business day of March, June, September, and December; the upcoming changes are published after the U.S. stock market closes. The DAX, MDAX, and TecDAX are regularly reviewed and adjusted twice a year, in March and September.

Friday, September 4

2:30 p.m. U.S.: August unemployment figures. Metzler’s Capital Markets Team expects the labor market to remain weak, with job growth in the low double-thousands and the unemployment rate rising to 4.2 percent.