German DAX index experiences a surge of approximately 0.8%; notable gains for Infineon due to impressive earnings.
German Stocks Rise as Eurozone Business Activity Shows Modest Growth
Eurozone business activity grew modestly faster in July 2025 compared to June, with the composite Purchasing Managers’ Index (PMI) increasing from 50.6 to approximately 50.9-51.0, signaling continued but sluggish expansion [1][2][3][5]. This marked an 11-month high in growth pace, driven mainly by stronger services sector expansion and a stabilizing manufacturing sector [2][3][4].
Key developments include:
- Services PMI climbed to around 51.0, indicating the fastest growth in the service sector since early 2025, with improved output and mild employment gains despite weak new export orders [1][4].
- Manufacturing activity remained near contraction territory but showed signs of stabilizing, with the PMI rising close to 50, the neutral level [3].
The overall business growth in July was modest but represented a hopeful sign of economic momentum returning, particularly helped by Germany’s manufacturing output expansion continuing for the second consecutive month [2]. Meanwhile, France’s manufacturing sector remained weak but showed some easing of contraction [2].
Impact on German stocks:
Germany, as the largest economy in the Eurozone and a critical manufacturing hub, showed a marginal increase in business output in July which contributed to offsetting weakness in other major countries like France [2]. This recovery in German industrial activity helped support confidence in German corporate earnings and may have positively influenced German stocks by signaling improving economic fundamentals and a potential end to manufacturing recession pressures [2][3].
In addition to the positive PMI data, several German companies reported strong performances. Infineon Technologies, a leading supplier of semiconductors, saw its profit from continuing operations rise to EUR293 million in the third quarter, and its earnings per share reached EUR0.22 [6]. The company's shares are up nearly 5% on strong earnings [7].
Another notable performer was Rational AG, the maker of commercial and industrial kitchen equipment, which backed its annual sales revenue growth outlook [8]. The company's shares are up 2.5% after posting improved Q2 results [7].
However, not all German companies fared well. Fresenius Medical Care, a leading provider of dialysis products and services, is down 4% due to quarterly results falling short of expectations [9]. Beiersdorf, a personal care products company, is down 1.1% [10].
Market performance:
The DAX, Germany's leading stock index, is up 182.47 points or 0.77% [11]. German stocks are up in positive territory on Tuesday [12]. Other notable gains include Daimler Truck Holding, Siemens, Siemens Energy, and Porsche, which are up 1.5 to 2% [13]**.
On the other hand, Commerzbank is declining by about 3.3% [14]**.
[1] Business Insider [2] Reuters [3] Bloomberg [4] CNBC [5] MarketWatch [6] Reuters [7] CNBC [8] Reuters [9] Bloomberg [10] MarketWatch [11] DAX Index [12] MarketWatch [13] Bloomberg [14] MarketWatch
- The positive growth in German business activity, coupled with strong performances from companies like Infineon Technologies and Rational AG, has contributed positively to the finance sector, potentially boosting investor confidence in the German stock market.
- The ongoing technology advancements in sectors like semiconductors and industrial equipment, as demonstrated by firms such as Infineon Technologies and Rational AG, are expected to play a crucial role in molding the business landscape and impacting the broader technology sector.
