## German Consumer Anxiety Weighs on DAX as Equities Show Conflicting Signals

The DAX real name index found itself navigating choppy waters Friday, slipping just 0.07% to settle at 24,180.41 as market participants grappled with mixed economic crosscurrents. While monetary policy recalibrations from the European Central Bank and Bank of England dominated trader conversations, a surprise softening in U.S. inflation metrics and anticipation of core PCE data injected uncertainty into the session.

**Where the Winners Clustered**

Among the DAX constituents, selective strength emerged in the industrials and utilities space. Heidelberg Materials led gainers with a robust 2%+ advance, while energy player RWE added 1.1% to its tally. The automotive sector showed modest resilience, with BMW, Mercedes Benz, and MTU Aero Engines each registering 0.7% to 1% gains. Siemens Energy, Commerzbank, and Munich RE also chipped in with similar percentage moves upward. Adidas managed a 0.3% recovery following early session turbulence that had stemmed from Nike's cautionary remarks on Chinese demand headwinds and tariff headwinds.

Puma, however, bucked the apparel recovery narrative, retreating 0.7% amid ongoing sector concerns.

**The Stumbling Blocks**

Digital and financial services names faced headwinds, with Deutsche Bank, SAP, and Deutsche Boerse all retreating by 0.3% to 1%. Henkel, Continental, GEA Group, and Daimler Truck Holding similarly faced downward pressure throughout the session.

**The Real Story: Consumer Confidence Crumbles**

Beneath the surface stock movements lay a more troubling narrative. Fresh consumer sentiment data—compiled collaboratively by NIQ/GfK and the Nuremberg Institute for Market Decisions—revealed a sharp deterioration in German household confidence as January approaches. The forward-looking confidence gauge plummeted to -26.9, a sharp drop from December's revised -23.4 reading and worse than consensus expectations of -23.0.

The culprits? Rising inflation apprehension is eroding income confidence, while purchase enthusiasm has sagged. December saw economic outlook expectations stall entirely, with buying intentions declining alongside income sentiment. Interestingly, Germans ramped up savings intentions by five percentage points to 18.7%—the strongest appetite for hoarding cash since mid-2008, a telltale sign households are bracing for economic uncertainty.

Consensus forecasts peg German economic growth at roughly 1% or marginally below for 2026, underscoring why consumers are tightening their belts as the new year unfolds.