DE40: Financials lead broad declines in Europe (29.08.2025)

European equities are trading lower on German lackluster economic data and banks’ selloff in the UK driven by renewed calls for a windfall tax on British lenders. DE40 and FRA40 are down 0.5%, SPA35 slumps nearly 1.2%, while SUI20 (-0.3%) and UK100 (-0.4%) trim a little less.

In August, Germany’s unemployment topped 3.02 million, up 46,000 from July, the highest in a decade, while the seasonally adjusted rate stayed at 6.3%. Job openings fell to 631,000, down 68,000 YoY, reflecting slowing labor demand. Retail sales dropped 1.5% in July, also underperforming expected YoY growth (actual 2%, estimate 2.3%). Import prices fell 1.4% YoY, amid weak domestic consumption, economic headwinds from global uncertainty and Russia’s ongoing war, challenging government stimulus impact.

Source: XTB Research

Among Eurostoxx 600 sectors, financials are posting the deepest losses, as investors are taking a cautious step back before today’s PCE inflation reading in the US, which will likely set the tone for September's FOMC meeting. IT is also seeing a significant slack, pulled down mainly by the German megacap SAP (-1.3%) and DAX-listed Infineon (-2.3%). Only Energy and Consumer Staples stocks are bucking broad European pessimism. 

Volatility in Eurostoxx 600 sectors. Source: Bloomberg Finance LP

Today’s performance of DAX-listed companies. Source: Bloomberg Finance LP

DE40 (D1)

DAX futures have broken below the key psychological support near 24,000, marking a fifth consecutive session of losses. The price remains slightly above the lower boundary of the emerging flag formation, but a close below this level without a decisive rebound could signal further downside for the German index. The RSI remains neutral, gradually approaching the oversold zone.

Source: xStation5

Company news:

• Deutsche Bank has been fined US$3M by Hong Kong’s Securities and Futures Commission for regulatory breaches between 2020–2023. Issues included overcharging clients, misassigning product risk ratings, and failing to disclose investment banking ties in research reports. The penalties follow the bank’s own self-reports to regulators. The stock is down 2.5%.

• Infineon and Delta Electronics expanded their partnership to develop vertical power delivery (VPD) modules for AI data centers. Leveraging Infineon’s MOSFET technology and Delta’s design expertise, the solution boosts efficiency, power density, and cuts heat loss. VPD can save up to 150 tons CO₂ per rack over three years, supporting 1 MW per rack future AI needs.

• ProSiebenSat shares added another 1.2%, extending yesterday’s 8% rally after Czech investor PPF agreed to sell its 15.7% stake to Berlusconi’s Media for Europe (MFE), raising MFE’s holding to about 60%. Investors consider expanded stake as an opportunity for operational advantages for the German media company.

• Rheinmetall secured a $622M deal with Romania to build an ignition powder plant, boosting regional defense supply amid the Ukraine war. Construction starts in 2026, lasting three years, and will employ 700 workers. The news coincides with Rheinmetall opening what could become Europe’s largest ammunition plant in northern Germany. The stock is the best performer today in DAX, adding nearly 3.6%.

• SoftwareONE rebounds nearly 6%, recovering most of yesterday's post-earnings slide (-7.8%) which occurred despite beating revenue forecasts with CHF 255.65M (vs. CHF 250M est.) and improved EBITDA to CHF 85M, with margins rising 1.9 pts. The drop was motivated by market caution on cloud market saturation, although the company expects growth recovery in H2 2025.