German DAX reaches record high of 26,202 points

The German stock index (DAX) closed up 0.8 percent at 26,202 points, marking a record high. During the trading session, the index reached an intraday peak of 26,266 points.

Mixed perspectives exist regarding the drivers behind the surge. Some attribute the record to hopes for a diplomatic solution in the Middle East, while others point to recent corporate earnings and expectations of improved international business. Jochen Stanzl, chief market analyst at Consorbank, stated that the new DAX highs are driven by expectations of better international business rather than hopes for economic improvement in Germany.

Geopolitics remain a central factor for investors. US Treasury Secretary Scott Bessent told CNBC that an agreement with Iran to reopen the Strait of Hormuz could be reached as early as Tuesday or Wednesday. A spokesperson for the Qatari Foreign Ministry stated that diplomatic efforts to resolve the Middle East conflict are continuing.

Timo Emden, a market analyst at CapTrader, noted that the combination of geopolitics, monetary policy, and corporate figures provides the necessary coordinates for investor navigation. Emden described the jump over the 26,000-point mark as a 'can opener' for the DAX, though he warned that the recent record streak should not mask significant risks stemming from the ongoing Iran conflict.

Corporate earnings and energy trends

As companies such as Zalando and Bayer present quarterly reports, results have been varied. German online retailer Zalando reported lower revenue and earnings than expected for the second quarter, closing at the bottom of the DAX.

In contrast, the German pharmaceutical and agricultural company Bayer exceeded second-quarter expectations due to strong agricultural business and cost reductions. Sales figures for new medications in Bayer's pharmaceutical division continued to increase significantly. This follows a June ruling by the US Supreme Court that Bayer cannot be sued for lacking cancer warnings on packaging for glyphosate-based weedkillers.

Lufthansa, an MDAX-listed company, reported that its second-quarter profit fell 88 percent to 123 million euros, citing high kerosene prices. Meanwhile, Brent crude and US light crude (WTI) prices fell to their lowest level in three weeks. Energy price developments are considered a primary driver of inflation in industrialized nations.