Dax faces a seven-day stretches of losses ahead

German Stock Market Dips as Defense Stocks Surge

The German stock market dipped on Friday, with the Dax trading 0.4% lower at 23,952 points. This comes as defense stocks continue to be in high demand among investors. Shares of Rheinmetall, Hensoldt, and Renk improved by 3.3%, 3.1%, and 2.8% respectively.

Meanwhile, the Euro Stoxx 50 also went down by 0.4%, suggesting a weekly loss of around 1.7% for the leading index. The MDax also decreased, falling 0.2% to 30,290 points.

One of the notable declines was seen in the shares of packaging specialist Gerresheimer, which had fallen to their lowest level since 2014 prior to the announcement of a new CFO, Wolf Lehmann, who will take over the position on September 1, 2025. Bernd Metzner, who has been with the company for six years, is leaving to pursue new professional challenges. Pallav Mittal of Barclays Bank commented that the change in management at Gerresheimer was long overdue.

Despite this, the share price of Gerresheimer increased by 0.9% following the announcement.

Schaeffler shares, on the other hand, were among the best performers in the SDax, with a 5% increase in early trading. Analyst Ross Macdonald suggested that Schaeffler could become a "champion" in the market for humanoid actuators, estimated to reach over $1 trillion by 2050. The shares of the automotive and industrial supplier have a year-to-date gain of nearly 40%.

Citigroup upgraded its rating on Schaeffler shares from "Neutral" to "Buy" and raised its price target from 5.00 to 6.75 euros.

In a positive note, the audio platform for children, Tonies, continued its recovery rally with a 9.6% gain, reaching 7.29 euros. Analyst Oliver Wojahn of MWB Research raised his price target to 11.70 euros and maintained his buy recommendation. The platform is set to launch its biggest product innovation yet in Europe on September 15.

Geopolitical uncertainties surrounding the Ukraine conflict and US trade policies are weighing on markets. However, fresh US economic indicators, such as data on private incomes and expenditures, the Chicago Purchasing Managers' Index, and the University of Michigan Consumer Sentiment Index, could provide impulses.

The previously hot topic of artificial intelligence has lost momentum. Analysts at Kepler Cheuvreux noted that short-term risks for Adesso had been overestimated. Additionally, they gave a buy recommendation for the company, which saw its shares soar by 5.1%.

The German and French governments are holding consultations on economic and security issues in the coastal town of Toulon. These discussions are expected to provide some clarity on the economic landscape in the near future.