The German stock market ended a turbulent week on a subdued note, with the DAX slipping 0.11 percent to close at 24,129 points on Friday. The weekly loss of 2.32 percent masks a market caught between two powerful forces: robust corporate earnings and an escalating crisis in the Middle East that is keeping oil prices elevated and investors on edge.
SAP and Siemens Energy Provide a Lifeline
Without the heavy lifting from some of its largest constituents, the DAX would have fared far worse on Friday. SAP emerged as the standout performer, surging as much as six percent after reporting better-than-expected cloud revenue growth for the first quarter. The software giant’s currency-adjusted cloud sales jumped 27 percent, and a healthy order book reassured investors that demand remains resilient despite the uncertain macro environment.
Siemens Energy also lent support, climbing 1.6 percent in late trading after delivering strong revenue growth and upgrading its full-year outlook. Chief Financial Officer Dominik Asam of SAP struck a cautiously optimistic tone, noting that the positive forecast hinges on a swift resolution to the conflict in the Middle East — a reminder that even the strongest earnings reports are tethered to geopolitical realities.
Auto Stocks and Defense Names Take a Hit
The flip side of the ledger was far less forgiving. Automakers bore the brunt of selling pressure, with BMW sliding 2.15 percent, Volkswagen preference shares dropping 1.90 percent, and Mercedes-Benz losing 1.59 percent. Defense stocks also saw profit-taking, with Rheinmetall plunging 5.90 percent. Bayer rounded out the losers, falling 3.85 percent.
The weakness in these sectors reflects broader concerns about the economic fallout from the crisis in the Strait of Hormuz, which remains closed, keeping Brent crude stubbornly above $100 a barrel. That dynamic is squeezing margins for energy-intensive industries and fueling inflation fears across the eurozone.
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A Critical Week for Policy and Earnings
Attention now shifts to a pair of pivotal events in the coming days. On April 29, Deutsche Bank will report its quarterly results, offering a window into how Germany’s largest lender is navigating rising interest rates — which boost lending margins — against a backdrop of growing credit risk as the economy slows.
The following day, the European Central Bank delivers its latest interest rate decision, and policymakers face a difficult balancing act. The ECB now expects inflation to average 2.6 percent for the full year, well above its target, while simultaneously slashing its eurozone growth forecast to a meager 0.9 percent. The conflicting signals make the direction of any rate move highly uncertain. A press conference on Thursday afternoon will provide clarity on the central bank’s thinking.
Charting a Path Through Support and Resistance
The technical picture offers a glimmer of hope for bulls. The DAX has been forming a series of higher lows since late March, a pattern that underpins the broader uptrend. The index is now trading almost exactly at its 200-day moving average of around 24,115 points, a level that has historically served as a key support.
If the 24,100-point zone holds, the path opens toward the next resistance level just below 25,200 points, where an unfilled price gap awaits. However, a decisive break below support could trigger a sharp sell-off. During Friday’s session, the index briefly tested the psychologically important 24,000 mark, touching an intraday low of 23,989 before recovering.
The coming days will also bring US gross domestic product data, which could move markets. A weaker-than-expected US growth reading might strengthen the euro further, adding to headwinds for Germany’s export-heavy industrial sector. For now, the DAX is walking a tightrope, with earnings season providing a temporary buffer against the geopolitical storm.
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