Profit-taking weighs on German defense stocks

On Friday, German defense stocks experienced another phase of profit-taking. Notably, Rheinmetall's stock saw a significant price drop, comparable to the downturn on April 9. After briefly falling well below the 500-euro mark, it eventually closed with a nearly four percent loss at 486.70 euros. During trading, it even dipped below the 100-day moving average, an important indicator for the mid-term trend. However, Rheinmetall was not the only company affected by this weakness. Other German defense stocks also recorded declines on Friday. Hensoldt continued its recent downward movement, losing up to four percent at one point. Over the course of the day, the stock recovered slightly, closing with a 2.3 percent loss. Here, there was a stabilization at the 200-day moving average, a level Rheinmetall has yet to reach. Renk, a specialist in tank gearboxes, recorded a daily loss of 6.8 percent on Friday, after the stock had fallen by as much as nine percent during the day. From the record high reached in early April, the stock has now lost over 40 percent. Despite these losses, the stock remains comfortably in the plus at 23.14 euros compared to its IPO price of 15 euros in February.