Buyers Return to DAX Ahead of Key Earnings: Can the Index Rebound Last?
After last week’s steep declines, German equities show signs of stabilization, with traders watching earnings and key technical levels for..
Quick overview
- German equities are stabilizing after last week's steep declines, with the DAX rising nearly 1.5%.
- Key earnings reports from major companies like Siemens and Commerzbank are expected to influence market direction.
- European markets are recovering from recent selloffs, driven by bargain-hunting and improved investor sentiment.
- Despite the rebound, caution remains as sustained momentum will depend on strong earnings and stabilization in global trade.
Live DAX Chart
After last week’s steep declines, German equities show signs of stabilization, with traders watching earnings and key technical levels for direction.
Market Rebound After Tariff and Political Turbulence
European markets opened the week in positive territory, with the DAX rising nearly 1.5% after a sharp selloff that marked its worst session since April. The bounce followed several sessions of pressure driven by August 1 tariff implementation, shifting trade narratives, and heightened political uncertainty. Investors also reacted to ongoing second-quarter earnings season for some of Germany’s biggest listed companies, which will guide the DAX’s near-term path.
Key Earnings to Watch
This week features major corporate results from heavyweight companies such as Infineon, Deutsche Post, Siemens Energy, Commerzbank, Beiersdorf, Bayer, Siemens, Deutsche Telekom, Allianz, Merck, and Munich Re.
Commerzbank has emerged as one of the DAX’s top-performing banks in 2025, benefitting from strong momentum in the European financial sector.
Siemens Energy remains a standout story, with shares soaring over 320% in the past year. Once close to bankruptcy and reliant on government support, its remarkable turnaround has transformed it into an $80 billion industrial powerhouse. Investors will closely scrutinize its earnings for signs of sustained growth.
Technical Outlook and Market Sentiment
From a technical perspective, DAX 40 broke below its 50 SMA (yellow) on the daily chart above for the first time since November 2024 before bouncing off the 100-day SMA (green), which now appears to be acting as support. With the stochastic indicator oversold, Monday’s rebound suggests the pullback may have reached a near-term floor.
DAX Chart Monthly – The Rally Has Stalled
However, on the monthly chart, June and July both produced doji candlesticks near record highs, reflecting buyer exhaustion and raising the possibility of a deeper August correction.
European Stock Indices Close Higher After Friday’s Selloff
European equities bounced back on Monday, partially recovering from steep declines at the end of last week.
Daily Performance
- Germany’s DAX: Gained +1.41%, rebounding after Friday’s -2.66% drop, signaling renewed buying interest in cyclical and industrial stocks.
- France’s CAC 40: Closed +1.14% higher, recovering part of Friday’s -2.91% decline, aided by strength in luxury and banking shares.
- UK’s FTSE 100: Added +0.66%, reversing a portion of Friday’s -0.70% dip, with energy and mining stocks providing moderate support.
- Spain’s IBEX 35: Led gains with a +1.84% rally, offsetting Friday’s -1.88% slide, boosted by financials and tourism-related companies.
- Italy’s FTSE MIB: Advanced +1.89%, bouncing back strongly from Friday’s -2.55% selloff, with domestic banking stocks driving the recovery.
Market Context
The recovery reflects bargain-hunting and stabilization after last week’s sharp declines triggered by tariff concerns, weak U.S. labor data, and broader risk-off sentiment. European investors appeared to take advantage of discounted valuations, particularly in sectors heavily impacted by the Friday selloff.
Conclusion: Monday’s rebound offers short-term relief after the sharp selloff, but broader caution remains. Sustaining upward momentum will likely depend on strong earnings from key DAX constituents, favorable macroeconomic signals, and a stabilization in global trade and political risk. Traders should remain alert for volatility as August unfolds.
German Stock Index DAX 40 Live Chart
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