The DAX index has steadied on Monday after sharp losses last week. On Monday the DAX is at 10,991, up 0.78%. There are no German or eurozone events on the schedule.

It was a dismal week for the DAX, which plunged 2.45% last week. Investors responded negatively to disappointing data out of the eurozone and Germany. Eurozone retail sales plunged 1.6% in January, its worst reading since December 2013. German manufacturing reports headed lower, raising concerns about the health of the eurozone’s largest economy. Factory orders slipped 1.6%, a second straight decline. Industrial production declined 0.4%, its sixth decline in seven months. German consumer indicators have also stumbled, raising concerns about the health of the eurozone’s largest economy. CPI declined by 0.8% in January and retail sales plunged 4.3% in December. If Germany and the eurozone continue to post soft numbers, the slide on Germany equity markets could continue.

Another factor affecting European stock markets last week was investor apprehension over the U.S-China trade war. Although the sides are talking, markets slipped after President Trump that he would not hold a meeting with President Xi prior to the March 2 deadline, when the U.S. is set to impose further tariffs if the sides fail to reach a deal. A third round of negotiations starts this week, with Treasury Secretary Mnuchin joining the talks later in the week. Investors are frustrated that there are no signs of progress, leading to concerns that the sides will not be able to reach a deal by March 2.

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