DAX Falls Nearly 7% as Recession Fears Escalate

German stocks are taking a pounding on Monday as fresh recession worries grip the market. U.S. President Donald Trump’s proposal for "reciprocal tariffs" and swift Chinese retaliation have sparked fresh concerns about a global slowdown.

The situation is worsened by disappointing industrial production data from Germany. Over the weekend, Trump warned that governments might have to pay “a lot of money” to drop these sweeping tariffs. At the same time, the risk of China flooding the EU with cheaper goods has raised alarms about potential revenue drops in Germany’s industrial sector.

Widespread selling has pushed the DAX index to a multi-month low. The benchmark fell to 18,813.25, losing almost 1,900 points, and despite a brief bounce-back, it closed firmly in the red at 19,293.75—a decline of about 6.82%.

Major companies are feeling the impact. Rheinmetall dropped nearly 13%, while Commerzbank fell by 11.8%. Other firms such as Sartorius, MTU Aero Engines, Heidelberg Materials, Adidas, Siemens Energy, Infineon Technologies, and Siemens lost between 9% and 11%. Fresenius slid 8.9%, and shares of Deutsche Bank, Zalando, Deutsche Post, BASF, Daimler Truck Holding, and Bayer tumbled by over 8%. Additionally, Hannover Rueck, Allianz, Continental, Fresenius Medical Care, Siemens Healthineers, SAP, Brenntag, and Munich Re all dropped between 6% and 7%, with further heavy losses seen in Merck, Volkswagen, BMW, Porsche, Henkel, E.ON, RWE, and Deutsche Telekom.

Data from Germany’s Federal Statistical Office, Destatis, showed a 1.3% drop in industrial production in February compared to January – following a 2% rise last month. For the year, industrial activity fell by 4%, after a 1.6% drop in January.

Another Destatis report hinted at a mixed picture on trade: Germany’s trade surplus grew to €17.7 billion in February from €16.2 billion in January. Exports rose by 1.8% month-over-month to hit a ten-month high of €131.6 billion, while imports increased by 0.7% to reach a 20-month high of €113.8 billion.