Germany's benchmark DAX closed flat on Tuesday, settling at 26,007.63 points as rising oil prices weighed on investor sentiment. Trading was thin, with dealers reporting sluggish turnover throughout the session.
Brent crude edged closer to the $100-a-barrel mark, while WTI and European gas prices also climbed. The escalation followed Houthi militant attacks on Saudi Arabia, which prompted the Gulf region's top producer to halt output at several facilities near the Yemen border.
"The oil price remains the fever thermometer of equity markets," said Jürgen Molnar of Robomarkets, noting that ongoing Middle East conflict keeps inflation concerns alive and suggests higher interest rates will be priced in for longer.
The Midcap MDax rose 0.43% to 32,544.30 points, buoyed by gains in heavyweights Porsche AG and DWS. Fresenius led the Dax with a 3.2% advance after UBS reiterated a buy rating. Analyst Graham Doyle said concerns over the company's US business and key biosimilar Tyenne were "completely overblown."
Semiconductor maker Infineon fell nearly 4% after Morgan Stanley downgraded the stock, dropping it to the Dax's bottom. Analysts saw little near-term upside for market expectations, though they acknowledged the structural appeal of chips for AI data centers remained intact.
In the MDax, Kion surged 6.8% after Citigroup issued a buy call. Analyst Martin Wilkie expressed optimism about artificial intelligence applications in warehouse automation. DWS climbed 2.8% on a Jefferies buy rating; analyst Laura Gris Trillo cited Germany's pension reform, growing ETF savings plans, and a €500 billion infrastructure program as drivers of mid-term fee-pool expansion. The fund arm of Deutsche Bank also announced it will operate worldwide under the new banner "Deutsche Asset Management," CEO Stefan Hoops said the rebrand reflects the company's international ambitions.
Hornbach Holding dropped 6.5% in the SDax despite reporting robust second-quarter demand at the hardware chain.
Elsewhere in Europe, the EuroStoxx 50 rose 0.14% to 6,413.17 points. In Zurich, the Swiss exchange fell 1.6%, weighed down by another slide in pharmaceutical heavyweight Novartis. Britain's FTSE 100 edged lower, while the US Dow Jones Industrial Average declined roughly 1% following Monday's holiday.
