Frankfurt’s benchmark index closed Friday with a fractional loss of 0.11 percent at 24,129 points, a session that laid bare the widening gulf between the market’s heavyweights and its laggards. While SAP’s cloud-driven surge provided a powerful tailwind, profit-taking in defence stocks dragged the DAX into negative territory, leaving the index nursing a weekly decline of 2.32 percent.
The software giant stole the spotlight after delivering a robust first-quarter report that sent its shares up by more than 6 percent. Cloud revenues jumped sharply, while the order backlog in that segment expanded by a quarter, comfortably beating market expectations. Infineon and Siemens Energy also managed modest gains, but they were outliers in a session where the vast majority of the 40 DAX constituents finished in the red.
Rheinmetall bore the brunt of the selling pressure, tumbling 6.24 percent as diplomatic efforts in the Middle East triggered a wave of profit-taking in the heavily overbought defence sector. The pain extended into the MDAX, where Hensoldt shed nearly 7 percent, while Renk and TKNS each gave up around 5 percent. MTU Aero Engines and Bayer were among the other notable decliners in the blue-chip index.
The sell-off was compounded by a weaker-than-expected Ifo business climate index for April, which added to the downbeat sentiment. The closely watched leading indicator fell more sharply than analysts had anticipated, reinforcing concerns about the health of Germany’s export-driven economy.
Chart technicians are now watching several key levels with heightened attention. The 200-day moving average, currently sitting at 24,115 points, acted as a ceiling on Friday, with the index oscillating around that resistance. A decisive break above the session high of roughly 24,330 points would brighten the short-term picture. To the downside, the psychological 24,000 mark represents the first line of defence, followed by the 50-day moving average at 23,924 points. A sustained move below the 23,408 support level would mark a significant deterioration in the technical setup.
Should investors sell immediately? Or is it worth buying DAX?
The coming week promises an intense barrage of corporate and macroeconomic events, compressed into just four trading sessions due to the May Day holiday on Friday. Monday’s calendar features quarterly results from Nordex and Südzucker, along with Henkel’s annual general meeting, where shareholders will be seeking clarity on the company’s future dividend policy. The GfK consumer confidence survey, due early in the session, will provide an initial read on domestic spending trends — a further deterioration could trigger another test of the lower support levels.
Tuesday brings Airbus’s after-market numbers, while Wednesday is the busiest day with Deutsche Bank, Mercedes-Benz, and Adidas all reporting. Thursday sees Volkswagen and BASF release their figures, alongside Apple’s post-market update in the US. The auto sector will be under particular scrutiny as investors look for signs of how deeply the demand slowdown is cutting into earnings.
Central banks add another layer of uncertainty. The Bank of Japan meets on Tuesday, followed by the Federal Reserve on Wednesday. While no rate changes are expected from either, Fed Chair Jerome Powell’s commentary will be dissected for clues on whether rate cuts remain on the table for 2026. The escalating Iran conflict, with the Strait of Hormuz under threat and oil installations suffering outages, is driving energy prices higher and stoking inflation fears — precisely the dynamic that could keep central banks on hold for longer.
On the upside, the first resistance level sits at 24,606 points. A breakout above that would open the path toward closing the gap near 25,180 points. For now, the index remains caught between competing forces: a stellar earnings season from some of its largest constituents and a macro environment that grows more precarious by the day.
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