The blue-chip DAX index ended the last trading session of the week flat, as investors digested fresh producer price data alongside a new US trade probe launched against Germany's pharmaceutical sector.
Destatis reported that annual producer prices rose 2.2% in May, compared with a 1.7% gain earlier and the market forecast of a 2.5% jump. Monthly producer prices were 0.3% higher, missing the expected 0.7% uptick. The German Federal Statistical Office attributed the year-over-year increase to higher costs of intermediate goods and energy prices.
On the trade front, the US government launched an investigation aimed at determining whether pharmaceutical pricing policies in Germany pose "unreasonable or discriminatory" barriers to American commerce. According to US Trade Representative Jamieson Greer's office, the investigation came after "months of meaningful discussions" with German partners to settle the matter.
"I am particularly concerned with news that Germany is fast-tracking legislation that would further reduce its spending on innovative pharmaceuticals. This is a serious step backwards at a time when our trading partners need to step up and start paying their fair share to fund innovative pharmaceutical research and development," Greer said.
Meanwhile, geopolitical uncertainty resurfaced after the Swiss Federal Department of Foreign Affairs confirmed that the scheduled peace talks between the US, Iran, Qatar and Pakistan were postponed. The delay threatens to cloud the outlook for the recently signed temporary agreement.
In corporate news, Commerzbank (CBK.F) pushed back against UniCredit's claim of support for its takeover bid, arguing that the disclosed 12.51% acceptance rate was largely driven by banks and parties linked to the Italian lender. Commerzbank toldthat acceptance among institutional and retail investors was "just slightly above 1%." The German bank gained 0.70% at Friday's close.
AlphaValue/Baader Europe cut its full-year 2026 and 2027 EPS estimates for Mercedes-Benz Group (MBG.F) by 15.2% and 20.7%, respectively, to 4.72 euros and 5.75 euros, flagging a "significantly" lower 2026 passenger car registration forecast from the China Passenger Car Association.
"This deterioration in the market outlook leads us to expect a weaker-than-previously-anticipated performance in China for Mercedes. In addition, BMW [BMW.F] recently highlighted increasing competitive pressure across the broader Asia-Pacific region, most likely as Chinese [original equipment manufacturers] continue to increase exports to these regions, further exacerbating pricing pressure, a headwind that we also expect to affect Mercedes. Consequently, the risk of a profit warning appears to be increasing," the research firm wrote. Mercedes-Benz gained 0.85%, while BMW climbed 0.57%.