Frankfurt stocks fall 0.74% as tech and Middle East concerns outweigh positive data

The Frankfurt Stock Exchange closed lower on Tuesday, with the DAX 40 index dropping 0.74% to 24,433.06 points. The decline was primarily driven by a sell-off in technology companies and ongoing concerns regarding the situation in the Middle East, despite some positive German economic indicators being released.

Earlier in the trading session, the German stock market had seen gains. Technology stocks were initially boosted by positive performance in Asian and US markets from the previous day. Additionally, a perceived de-escalation in the Middle East, following reports of Iran and Israel pausing attacks and U.S. President Donald Trump suggesting a potential deal with Iran, contributed to the initial optimism. This easing of tensions also saw the price of Brent crude oil, a European benchmark, fall to just under $92 per barrel.

However, the market sentiment shifted in the latter hours of trading as Wall Street experienced a downturn, dragging down European tech stocks. Despite this, some German economic data offered a glimmer of positivity. Manufacturing production in Germany rose by 0.4% in April compared to the previous month, largely thanks to the construction sector benefiting from favorable weather. German exports also showed strength, increasing by 3.6% year-on-year and 0.9% from the previous month in April.

Despite the positive economic news, major technology firms saw significant losses. Siemens Energy, the parent company of Gamesa, fell 5.9% to 148.30 euros. Semiconductor producer Infineon lost 3.3% to 75.66 euros, and enterprise software maker SAP declined 2.1% to 154.70 euros. Conversely, Symrise, a company specializing in fragrances and flavors, surged 7.2% to 81.22 euros, driven by gains in Swiss competitor Givaudan. Defensive stocks like consumer goods manufacturer Henkel and Beiersdorf (Nivea) also saw modest gains.