04/08/25 09:17:08

Weekly outlook: “Correction was overdue”

The stock markets look battered - the higher tariffs will slow down Germany's economy, it is said. But the euphoria is also gone in the USA. However, August is one of the weak months for equities anyway.


4 August 2025. FRANKFURT (Börse Frankfurt). The “tariff list” published by US President Trump last week is weighing on the stock markets. “The general tariff uncertainty remains, even if Europe is one of the ‘lucky’ countries with a deal,” says Helaba analyst Claudia Windt. The “deal euphoria” on the global equity markets is limited in any case. “While the US technology giants have climbed to new highs, the rest continue to fall,” she notes. Whether there will be more confidence this week is questionable. “There is little positive momentum for equities.”

The DAX DE0008469008 fell significantly from Thursday last week and closed the week at just under 23,426 points - well below the all-time high of 24,639 points reached in July. At 536 points, the Stoxx Europe 600 EU0009658202 is also trading well below its record high. The US stock markets also closed clearly in the red on Friday. The surprisingly weak US labor market made itself felt here.

Tariffs weigh on US labor market

“Only 73,000 new jobs were created in July, considerably fewer than expected,” says Rolf Schäffer from LBBW. In addition, the employment figures for the two previous months have been revised downwards. This has further reinforced the impression of a deteriorating labor market situation. “Observers see this as a clear sign of a slowdown, which is likely to be primarily due to US President Donald Trump's tariff policy.” The recently imposed tariffs are not only weighing on international trade, but also increasingly on the domestic economy.

“Difficult seasonal phase”

However, the tariffs are not the only negative factor: “The correction was overdue,” comments chart technician Christoph Geyer, referring to the upcoming difficult seasonal phase. On Friday there was a foretaste of what could happen between now and the end of September. LBBW analyst Andreas da Graça also points to seasonality: “The DAX performance has tended to be negative during the summer breaks of the past 24 years,” he explains. For August, the average performance since 2000 has been around minus 1.7 percent.

Christoph Geyer

“Technical scope for further price losses”

According to Helaba, the technical picture clouded over massively last week. "Indicators such as MACD and Stochastic are falling below their signal lines and the DMI is switching to sell. In addition, the lower limit of the ‘sliding zone’ of July just below 24,000 points has been breached," explains Ralf Umlauf. After Friday's slide, room for further price losses has opened up. Potential holding points are the interim low at 23,274 points and the low at 23,051 points.

Meanwhile, the reporting season continues, with Siemens, Allianz, Deutsche Telekom, Siemens Energy and Infineon, for example, presenting their figures for the second quarter this week. In the USA, Berkshire Hathaway, Pfizer and Advanced Micro Devices US0079031078 are among those reporting.

Important economic and business data

Wednesday, 6 August 

8.00 am. Germany: New industrial orders June. Commerzbank expects incoming orders to have risen again noticeably after a fairly significant drop in the previous month. It forecasts an increase of 1.5 percent compared to the previous month,

11.00 am. Eurozone: Retail sales June. Sales are expected to have risen by 0.4 percent in June compared to the previous month, following a fall of 0.7 percent in May.

Thursday, 7 August

8.00 am. Germany: Industrial production June. DekaBank expects little movement. While industrial production and energy production weakened, positive impulses would come from construction.

8.00 am. Germany: Exports June. According to Commerzbank, foreign trade figures are likely to show a further decline in German goods exports, especially because deliveries to the USA are suffering from higher US tariffs.

13.00. Great Britain: Bank of England interest rate decision. The Bank of England is likely to cut its key interest rate by 25 basis points to 4 percent, predicts DekaBank.

by Anna-Maria Borse, 4 August 2025, © Deutsche Börse AG

Anna-Maria Borse is a financial and business editor specializing in financial markets/stock exchanges and economic issues.

Feedback and questions to redaktion@deutsche-boerse.com