DE40: DAX retraces after retesting all-time highs, while Zalando jumps on strong earnings report

• Zalando SE reported stronger-than-expected first-quarter revenue growth of 7.9% to €2.42 billion

• Fresenius Medical Care AG reported quarterly adjusted earnings of 41 cents per share for the quarter ended March 31

• MTU Aero Engines AG posted first-quarter adjusted EBIT of €300 million

• Continental AG more than doubled earnings in the first quarter as its consolidated sales reached €9.7 billion

European markets are broadly negative today. Poland's W20 is showing the steepest decline, down 2.47% to 2690.6. Germany's DE40 has fallen 1.08% to 23212.6, while the pan-European EU50 index dropped 0.64% to 5215.6.

France's FRA40 decreased 0.52% to 7651.4, and both Austria's AUT20 and the UK's UK100 declined 0.39% to 4049 and 8594.0 respectively. Italy's ITA40 fell 0.28% to 37815, while the Netherlands' NED25 slipped 0.27% to 890.32.

Spain's SPA35 showed a smaller loss of 0.13% to 13514, and Switzerland's SUI20 was nearly flat with just a 0.05% decline to 12186. The only gainer was the volatility index VSTOXX, which rose 1.44% to 21.08, suggesting increased market uncertainty.

Dax Returns by Sector. Source: Bloomberg Financial LP

Volatility is currently observed in the broader European market. Source: xStation

The German DE40 Index is maintaining its bullish momentum retracing after a retest of highs and trading above the 23.6% Fibonacci retracement level and the 50-day SMA. Bulls will aim to hold above the 23.6% level, while bears will attempt to push the price below it, targeting the 50-day SMA. The RSI continues to show bullish divergence with higher lows, while the MACD is widening following a bullish crossover. Source: xStation

Market News

• Zalando SE (ZAL.DE) reported stronger-than-expected first-quarter revenue growth of 7.9% to €2.42 billion, surpassing analysts' average forecast of €2.367 billion. The company is moving upmarket with additional designer brands, adding LVMH-owned Marc Jacobs in Q1 to counter competition from budget platforms like Shein. Despite the "fast-changing geopolitical and macroeconomic environment" including U.S. tariffs, Zalando maintained its 2025 guidance of 4% to 9% growth in revenue and gross merchandise volume, with adjusted EBIT expected between €530 million and €590 million. The number of active customers reached a new high of 52.4 million, up from 49.5 million in the same quarter last year.

• Fresenius Medical Care AG (FME) reported quarterly adjusted earnings of 41 cents per share for the quarter ended March 31, identical to the same quarter last year and above the mean analyst expectation of 38 cents per share. Revenue rose 3.3% to €4.88 billion from a year ago, exceeding analysts' forecast of €4.78 billion. The company's reported EPS for the quarter was 26 cents. Shares had risen by 2.9% this quarter and gained 13.2% so far this year, with the current average analyst rating on the shares being "hold."

• MTU Aero Engines AG posted first-quarter adjusted EBIT of €300 million, surpassing estimates of €260.7 million and representing a 38% increase compared to the first quarter of 2024. Adjusted revenue grew 25% to €2.1 billion, while adjusted net income increased by 41% to €221 million. The company maintained its 2025 earnings and free cash flow guidance, only adjusting its revenue outlook in euros to reflect the latest exchange rate environment. CEO Lars Wagner warned that U.S. customs policy could potentially impact the company with costs in the "mid to high double-digit million euro range."

• Continental AG (CON.DE) more than doubled earnings in the first quarter as its consolidated sales reached €9.7 billion, down slightly (-0.8%) from the previous year. The adjusted operating result increased to €639 million (or €586 million without application of IFRS 5), corresponding to an adjusted EBIT margin of 6.6% (or 6.0% without IFRS 5). Net income in the first quarter was €68 million, compared to a loss of €53 million in Q1 2024. The company is in the midst of an extensive overhaul, including a spinoff of its auto-parts unit and potential offloading of its ContiTech industrial division, while already announcing personnel cuts across German sites totaling more than 10,000.

Other news coming from individual DAX index companies. Source: Bloomberg Financial LP