Europe's Stocks Defy Seasonal Pattern in Record-Breaking August

The European stock market has entered August in an unusual manner. Historically, this month is considered one of Europe's weakest for equities, but the EURO STOXX 50 and DAX have reached record highs, while the CAC 40 remains close to its peak.

According to data from Germany's DAX, which tracks the 40 largest companies on the Frankfurt exchange, since 1970, August has averaged a loss of 1.03%, while September has averaged a loss of 1.64%. Similarly, France's CAC 40, with data back to 1988, has seen August average a loss of 1.22% and September a loss of 1.38%.

However, August 2026 has not followed this pattern. On 11 August, the EURO STOXX 50 closed at an all-time high above 6,560 points, up roughly 13% since the start of the year. The DAX moved above 26,450 for the first time, and the CAC 40 finished around 8,740 points.

The explanation may lie in market functioning during summer. Europe effectively goes on holiday in August, with thinner trading desks and fewer active investors, which can make markets more sensitive to sell-offs. There are also fewer scheduled monetary-policy decisions; the European Central Bank's latest meeting was in July, with the next not due until September.