Blue-chip DAX Index Slips; German Private Sector Growth Eases

11:48 AM EDT, 10/23/2026 (MT Newswires) -- Germany's blue-chip DAX index fell 0.86% on Friday's close as investors assessed the latest private sector data from the eurozone's largest economy alongside macroeconomic concerns due to sustained Middle East conflict. According to business survey data compiled by S&P Global, the flash German Composite PMI Output Index came in at a two-month low of 52.8 in October, against the prior month's 11-month high of 53.8 and the market forecast of 53.3. Germany's private sector expanded for the fourth straight month, though growth cooled as service sector activity rose only "modestly" and manufacturing output registered its slowest expansion since July. Zooming out, the preliminary seasonally adjusted S&P Global Eurozone Composite PMI Output Index eased to a four-month low of 51.9 in October, down from the 53.1 previously and the flash estimate of 52.7, marking the slowest pace in a four-month expansion streak. The euro area's private sector growth slowed at the start of the final quarter of 2026, dragged down by cooling business activity, France's slide back into contraction amid ongoing domestic unrest, and heightened inflationary pressures. Compounding these headwinds, Rystad Energy warned of growing energy vulnerabilities as Europe enters winter with gas storage near 75%, and Germany at just 61%, behind last year's levels and without the surge in liquefied natural gas imports needed to rebalance the market amid the persistent risk in the Strait of Hormuz. "As winter approaches, Europe has less of a storage cushion than needed and fewer options to quickly replace disrupted supply. The continent's LNG imports were 30% below last year for the week ending 9 October, and while mild weather has kept heating demand subdued, temperatures alone can't reverse the vulnerability faced by the continent. The real risk is a cold snap arriving at the same time as Asian buyers step up purchasing. China and South Korea are already seeing temperatures fall, and if that translates into sustained spot buying, European buyers will have to pay up to retain Atlantic cargoes," Rystad Energy Gas and LNG Markets Analyst Mathieu Utting said. On the corporate side, IG Metall warned of potential strikes at Volkswagen (VOW.F, VOW3.F) unless the German automaker reinstates canceled wage agreements, Reuters reported, citing Thorsten Gröger, the union's district leader of Lower Saxony and Saxony-Anhalt. Speaking at a press conference, Gröger set an Oct. 31, 2026, deadline for the company before an existing no-strike truce expires on Jan. 1, 2027. Volkswagen fell 0.36%. Meanwhile, Berenberg affirmed Fresenius SE's (FRE.F) buy rating and raised its price target to 54 euros from 50 euros, noting the German healthcare company's unpriced growth vectors. Its stock closed the session 1.23% in the green. "The market values Fresenius as a hospital-heavy conglomerate and has not rewarded its shift towards its faster-growing, increasingly profitable growth vectors - biosimilars (Biopharma), Nutrition and MedTech - which are funded by its cash-generative hospital (Helios) and IV generics businesses (Pharma)... We forecast high-single-digit mid-term EPS growth per year, and our 2027 estimate is 2% above consensus. Management guides conservatively and has raised guidance on four occasions in two years; therefore, we think risk to consensus is skewed to the upside," the research firm wrote.