DAX Slides as Tech Rout Overwhelms Bayer’s Supreme Court Victory, Erasing M&A-Fuelled Rally

German blue-chip index falls from near 25,000 as Asian tech selloff hits Infineon; Bayer jumps on Supreme Court ruling, while automakers drag on job cut fears.

A brutal two-session shift has left the German blue-chip index nursing heavy losses after a global technology selloff steamrolled the M&A euphoria that had propelled it within striking distance of 25,000 points just 24 hours earlier. By Friday lunchtime, the DAX had slumped 1.2 percent to trade around 24,689, having briefly kissed the psychologically significant level on Thursday.

The turnaround was triggered in Asia, where the Nikkei tumbled 4.2 percent and South Korea’s Kospi cratered 5.8 percent on growing concerns over rising memory-chip costs. That weakness spilled directly into European tech names: Infineon shed 4.3 percent, undoing all the gains it had made on Thursday when a blockbuster outlook from US peer Micron Technology had lifted the stock by over 3 percent. The broader selloff was accompanied by unusually heavy volume, well above the five-day average, confirming the selling pressure was broad-based rather than a thin signal.

Yet inside the gloom, one counter-narrative exploded. Bayer shares rocketed 17 percent after the US Supreme Court ruled in favour of the company in the long-running glyphosate litigation, affirming that federal law preempts state-law claims. The decision effectively bars thousands of future lawsuits, handing Bayer its biggest single-day gain in the index. The judgment contrasts starkly with the drag from automakers: BMW fell 3.3 percent, Volkswagen dropped 3.0 percent as it plans to cut up to 100,000 jobs, and Mercedes eased 2.8 percent after delaying bonus payments.

Zalando was the session's worst performer, slumping 6.8 percent after Germany’s financial regulator, BaFin, opened a probe into the company’s consolidated financial statements related to its acquisition of About You, citing possible accounting irregularities.

The Thursday rally that preceded this rout had been powered by two mega-deals. Merck agreed to buy US life-sciences firm Bio-Techne for nearly €10 billion, a move investors cheered with a near-5 percent gain in the stock. At Volkswagen, the sale of a majority stake in its battery subsidiary Everllence to Bain Capital was valued at over €8 billion, well above book value, lifting VW shares 1.7 percent. Additionally, a surprise rise in Germany’s Ifo business climate index to 85.6 in June and an upward revision to first-quarter US GDP boosted risk appetite among institutional investors, pushing the DAX to a close of 24,994.

But the mood soured quickly. Friday’s Ifo employment barometer dropped to 92.3, signalling that industry and trade are planning more aggressive job cuts. That, combined with the Asian tech rout, erased Thursday's momentum. Technical support is now being tested: the 50-day moving average sits at 24,604, and the day's low of 24,668 marks the first line of defence. Below that, the psychological 24,500 level looms. Meanwhile, the RSI has slipped to 48.6, tilting bearish without yet reaching oversold territory.

Pre-market US futures suggest no immediate respite: the Nasdaq is pointing 1.2 percent lower and the S&P 500 0.5 percent lower. If Wall Street confirms the selloff, a test of 24,500 looks likely. Should the DAX instead stabilise above its 50-day line, it would offer the first technical hint that selling exhaustion is setting in — a pattern that would leave the all-time high at 25,507, set in January, still within reach.