The German market’s benchmark index experienced a significant decline Thursday morning, impacted by a sell-off in SAP and Deutsche Bank stocks, alongside a downward revision by the government regarding the nation’s growth projections. Market participants processed the Federal Reserve’s monetary policy announcement while remaining attentive to ongoing geopolitical developments. The Federal Reserve, having opted to maintain its interest rates on Wednesday, indicated that this choice was made in the context of heightened uncertainty regarding the economic outlook. The central bank indicated its ongoing vigilance regarding the potential risks associated with both aspects of its dual mandate: achieving maximum employment and maintaining inflation at a target rate of 2% over the long term.

On Friday, a series of German economic indicators will be released, encompassing reports on GDP, inflation, import prices, and unemployment rates. The DAX experienced a decline of 295.25 points, reflecting a decrease of 1.19%, recently standing at 24,548.29. On Wednesday, the German government revised its growth projections for 2026 and 2027 downward, attributing this adjustment to external challenges and a lack of robust domestic momentum. SAP experienced its most significant single-day decline in over five years, plummeting more than 13% this morning, following the software giant’s fourth-quarter earnings falling short of expectations. SAP announced that its profit after tax for the fourth quarter reached 1.9 billion euros, reflecting a 17% increase compared to the previous year. Basic earnings per share under IFRS rose by 15% to reach 1.58 euros. Non-IFRS operating profit increased by 16% to 2.83 billion euros, reflecting a 21% rise when adjusted for constant currencies. Non-IFRS basic earnings per share rose by 16% to 1.62 euros.

For 2026, SAP anticipates cloud revenue at constant currencies to range between 25.8 and 26.2 billion euros, reflecting an increase of 23% to 25% at constant currencies. Additionally, cloud and software revenue at constant currencies is projected to be between 36.3 and 36.8 billion euros, representing a growth of 12% to 13% at constant currencies. Furthermore, non-IFRS operating profit at constant currencies is expected to fall between 11.9 and 12.3 billion euros, indicating an increase of 14% to 18% at constant currencies. Deutsche Bank experienced a decline of nearly 2%, even as it reported its most substantial annual profit since 2007. The lender reported earnings of EUR1.503 billion, equating to EUR0.76 per share for the fiscal year 2025, in contrast to EUR304 million, or EUR0.15 per share, from the previous year. The bank’s revenue for the period increased by 6.9%, reaching EUR7.726 billion compared to EUR7.224 billion in the previous year.

Symrise experienced a decline of approximately 2.7%. Bayer and Fresenius experienced significant declines, whereas Rheinmetall, Commerzbank, and Scout24 recorded moderate losses. Siemens Energy experienced an increase of 3.1%, Siemens saw a rise of 2.7%, and GEA Group surged by 2.2%. Volkswagen increased by 1.7%, followed by Mercedes-Benz at 1.5%, Continental at 1.4%, MTU Aero Engines at 1.2%, Qiagen at 1.2%, Deutsche Post at 1.1%, and Deutsche Boerse at 1% as well, all showing significant upward movement.