German Stocks Break Losing Streak as Nvidia Optimism Drives Recovery

German equities staged a decisive comeback on Thursday, halting a five-day losing streak with solid upside momentum. The recovery was fueled by Nvidia’s upbeat earnings report and forward guidance, which helped ease lingering concerns about valuations in the AI sector. Simultaneously, market participants remain attentive to upcoming U.S. employment figures that could provide insights into the Federal Reserve’s policy trajectory.

Market Performance and Index Movement

The DAX benchmark climbed toward 23,454.15 during intraday trading, posting gains of 198.51 points or 0.86%, settling around 23,402.65 at mid-session. This bounce represents a meaningful reversal of sentiment following the previous week’s downturn.

Among top performers, Rheinmetall emerged as the day’s standout gainer, surging 5.4%. Energy and industrial names also participated in the rally, with Siemens Energy advancing 5.1%. Gains were broadly distributed across the utilities and materials space, where Qiagen, RWE, and GEA Group climbed 2.75%, 2.5%, and 2.3% respectively. Commerzbank appreciated nearly 2%, while MTU Aero Engines, Allianz, Heidelberg Materials, Fresenius, E.ON, and Infineon Technologies all posted noteworthy advances.

Renewable energy specialist Nordex gained 2% following news of a significant contract to deploy and install 12 N133/4.8 wind turbines at the Drumnahough Wind Farm location in County Donegal, Ireland. This five output device milestone underscores ongoing demand in Europe’s energy transition sector.

Sectoral Headwinds

Luxury and automotive stocks faced pressure, with Volkswagen, Adidas, BASF, Porsche Automobil Holding, Mercedes-Benz, BMW, and Daimler Truck Holding declining between 0.7% and 1.4%. The sector weakness reflects broader concerns about consumer spending and industrial cyclicality.

Economic Data Takes Center Stage

German producer price data released by Destatis revealed a continued disinflationary trend, marking the eighth consecutive month of decline. Year-over-year, producer prices fell 1.8% in October, representing an accelerated drop from September’s 1.7% contraction. However, the magnitude proved less severe than the 1.9% decline economists had anticipated. On a month-over-month basis, prices edged up marginally by 0.1%, confounding expectations for flat readings.

Eurozone construction sector activity deteriorated during the same period. Eurostat figures showed construction output contracted 0.5% in September, extending the weakness from August’s 0.2% decline. The yearly comparison was equally disappointing, with output down 0.3% versus an expansion of 1% in the prior year. This deterioration signals potential headwinds for the broader European economy ahead.