The blue-chip DAX index ended the trading day in the green, closing 0.61% higher on Tuesday, on the back of improving German economic growth and business confidence metrics.
Final data from Destatis showed that Germany's gross domestic product ticked up 0.3% in the second quarter, following a 0.4% gain in the previous three-month period. The final reading came in above the flash estimate of a 0.2% increase. Federal Statistical Office President Ruth Brand said the main growth driver was positive export performance.
Concurrently, the ifo Institute's business climate indicator stood at 88.8 points in August, up from July's revised 86.7 points and the expected 87.2 points. The expectations indicator ticked up to 89.1 points from the revised 86.8 points, while the current conditions index rose to 88.5 points from 86.5 points.
On the geopolitical side, Iran expressed confidence in countering escalated US sanctions following Washington's announcement of an "economic D-Day" targeting nations and banks doing business with Tehran. Economy Minister Ali Madanizadeh said the country is "fully prepared" to navigate the expanded restrictions.
"The biggest oil-market risk may not be the sanctions themselves, but Iran's response to them," Rystad Energy said, describing the initial measures as "less dramatic" than anticipated. "The relatively muted oil-price reaction so far suggests the market is making the same distinction. What matters now is not the announcement itself, but whether China complies and whether Iran retaliates."
In corporate news, Rheinmetall (RHM.F) won a 250 million-euro contract from the Bundeswehr to build and manage a modular soldier camp in Lithuania. As main contractor, the German arms maker will oversee construction and facility management ahead of its mid-August 2027 operational launch. Rheinmetall was down 0.62% at closing.
Meanwhile, Ottobock (OBCK.F) rose 1.51% as Deutsche Bank Research raised the price target of its buy-rated stock after the medical technology company delivered robust second-quarter performance and upgraded its full-year 2026 outlook. Ottobock narrowed its 2026 organic core revenue growth outlook to between 6% and 8% from 5% to 8% previously, reflecting good first-half business momentum.
"After a somewhat slower first quarter, growth is now accelerating, and the updated guidance implies a strong performance will continue in the second half of the year. We believe the attractive medium-term outlook, which is fueled by industry-leading innovation, is not yet properly reflected in the share price. The stock is still trading at only 16x 2027E P/E, a valuation we find compelling. Driven by the company's raised guidance, we have increased our adjusted net income estimate by 6% for 2026 and by approximately 1% for 2027. Consequently, our target price is raised to EUR85 (from EUR83)," the research firm wrote.