Germany's DAX 40 reached a new all-time intraday high on Thursday 5 November 2026, only to give back the gains and close lower as a sell-off in United States technology shares spread to Europe and defence group Rheinmetall plunged.

The index climbed to 26,692.90 points during the session, passing the previous record of about 26,618.74 set on 28 August 2026. It then reversed by more than 360 points from that peak and closed at 26,325.01, down 112.66 points or 0.43 percent from Wednesday's close of 26,437.67.

The turn came as trading opened in New York. The Nasdaq Composite slid by more than 5 percent at its worst point, extending a sell-off in artificial intelligence stocks after Democrats won control of both chambers of the US Congress. Investors worried that a Democrat-controlled Congress would increase scrutiny of data-centre expansion and electricity demand, and that hyperscalers might slow their spending plans.

Infineon Technologies was the heaviest DAX loser, falling more than 8 percent as German semiconductor shares tracked the rout in US chip stocks. The pain was sharper further down the market. In the MDAX, Siltronic, Aixtron, Nemetschek and Suss MicroTec fell between 9 and 14 percent, while in the SDAX, LPKF and PVA TePla each dropped around 12 percent.

Rheinmetall was the other major drag on the index. The defence group cut its 2026 outlook for a second time in several months, and its shares fell by more than 16 percent during the session. Defence names had already been under pressure as markets priced in a possible de-escalation of the Iran conflict, which would reduce some of the urgency behind Europe's rearmament spending.

Before the reversal, a powerful mix of factors had supported German equities. The midterm outcome, hopes for diplomatic progress in the Iran war, lower energy prices and falling bond yields all helped, alongside a wave of corporate earnings. The DAX had gained more than 5 percent, or roughly 1,400 points, over the preceding two weeks, and had surged 2.22 percent, or 573.05 points, on Wednesday alone.

Deutsche Telekom stood out on the positive side after raising its full-year targets once again. Telecommunications and utilities, traditionally defensive sectors, held up better as the afternoon sell-off intensified, but only a handful of DAX constituents managed to finish in positive territory.

The broader German market fared worse than the blue-chip index. The MDAX closed down 0.92 percent at 30,891.56, from 31,178.27 on Wednesday, while the small-cap SDAX dropped 1.39 percent to 18,012.80, ending close to its daily low of 17,948.59.

Across Europe, results were mixed. France's CAC 40 rose 0.34 percent and Spain's IBEX 35 gained about 0.8 percent, while Italy's FTSE MIB dropped 1.03 percent and the Euro Stoxx 50 ended roughly 0.13 percent lower. In Asia, Hong Kong rallied 3.67 percent while Tokyo's Nikkei 225 fell 1.79 percent on chip losses.

The selling continued on Friday. Germany's DAX 40 dropped 1.92 percent to 25,820.36, a day after the record high, as the global technology sell-off deepened. Analysts had flagged support at 26,500, 26,200 and 26,000, with resistance near 26,700, 26,800 and the psychologically important 27,000 mark. Whether the index can hold the 26,000 to 26,300 support band will be the first test for buyers in the new week.