German stocks performed well in 2024 despite continuing concerns about the economy. The blue-chip DAX index rose by almost 20% this year, one of its best annual performances in over a decade.
Siemens Energy led the charge
Siemens Energy, which almost went bankrupt in 2023, was the best performer in the DAX index in 2024. Its stock jumped by over 300% as investors cheered the government bailout, which prevented it from collapsing.
Siemens Energy also continued to publish strong financial results. The most recent financial results showed that its order intake rose by 42.3% in the third quarter to over €15 billion. Its revenue rose by 16.6% to €9.7 billion, while its net loss improved to €83 million.
Therefore, analysts believe that Siemens Energy’s business will continue thriving in the next few years because there is still substantial energy demand. The firm expects that its revenue growth for FY25 will be between 8% and 10%, and its margins will be between 3% and 5%.
Siemens Energy’s performance might bode well with Bayer, which was the worst-performing company in the DAX index this year. Bayer share price has dropped by 42% this year and is down by 60% in the last three years. As such, a significant rebound cannot be ruled out in 2025.
Rheinmetall stock soared by 115%
Rheinmetall share price soared by more than 115% in 2024 and hit its all-time high of €663 in November. This surge was mostly because it is the biggest defense contractor in Germany. Like other firms in the industry, it has benefited from the ongoing geopolitical tensions globally.
A war is still happening in Ukraine, while tensions between the United States and Russia have risen. These tensions will likely remain under pressure now that Donald Trump has appointed renowned China hawks in senior positions.
Trump has also hinted that he will encourage NATO members to spend more on defense, which would benefit the company.
SAP shares surged in 2024
Meanwhile, the SAP stock price soared by over 70% in 2024 as the company continued experiencing major tailwinds. Its cloud backlog rose by 25% in the third quarter to over €15.4 billion.
SAP’s cloud revenue rose by 25%, while its ERP Suite was up by 34%. Its total revenue moved up by about 9%. The company expects to continue doing well in the coming quarters as demand rose.
Other top companies that did well during the year were Zalando (52%), Heidelberg Cement (47%), Commerzbank (43%), and Deutsche Bank (33%). Commerzbank’s stock jumped after Unicredit continued to accumulate it, and analysts expect it to make a full bid. The other top gainers during the year were insurers like Allianz and Munich Re.
On the other hand, the top laggards in the DAX index were firms like BASF, Deutsche Post, Mercedes Benz Group, Porsche, BMW, RWE, and Volkswagen. All these stocks have crashed by more than 10% this year.
DAX index analysis
The daily chart shows that the DAX index peaked at €20,517 in 2024 and has pulled back sharply in the past few days. It has retreated to €20,000, an important support level.
The stock has formed an ascending channel and is now between the two lines. Also, the two lines of the MACD indicators have formed a bearish crossover, while the Relative Strength Index (RSI) has tilted downwards.
Therefore, the stock will likely drop and retest the lower side at €19,500. In the long-term, the index will likely rebound and possibly retest the year-to-date high of €20,517.
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