The monthly SAFE Manager Sentiment Index rises from -0.08 to -0.01 in February, reflecting a slightly more positive tone in the financial reports and earnings conference calls of companies listed in Germany. Overall, sentiment remains neutral - and DAX companies are taking a relaxed view of US tariff policy.
"The mood among Germany's listed companies is surprisingly good," says Florian Heider, Scientific Director at the Leibniz Institute SAFE. "The listed companies are globally positioned. The fact that the index remains neutral despite isolationist tendencies is a good sign."
SAFE Sentiment Index
Trade policy on the agenda
An analysis of the earnings calls shows that US tariff policy under President Donald Trump is particularly relevant: In the past three months, tariffs were discussed in 27 calls - about a quarter of all relevant call transcripts from November to January. "It shows that US tariffs are on the minds of markets and analysts," says Heider.
"Many managers believe they are well prepared or even expect positive effects from possible US tariffs," says Alexander Hillert, Professor of Finance and Data Science at SAFE. He conducts the monthly analysis of the SAFE Index. In 60 percent of the calls, the executives expressed a positive view of tariffs. Only in 15 percent of cases did the managers express a negative opinion. In the remaining calls, managers were neutral or did not have a clear opinion on the issue.
DAX companies well positioned
Executives often cite local-for-local production and flexible supply chains as reasons for the positive sentiment. This makes it possible to source resources globally and adapt to changing market conditions.
For example, one company explains: „If you are a local producer with a local footprint, you are, of course, benefiting in case there's something changing on the tariff side.“ Another emphasizes: „We will even benefit from those protectionism activities we maybe could expect from the new President because we are pretty well located in the United States of America, in other words, behind those protectionism walls.“ A manager from another company refers to supply chains: „That sourcing strategy gives us the utmost flexibility because we do see that the duties and the tariffs have become very volatile, not only for the US but also for other markets.“
However, other statements make it clear that even well-prepared-for tariffs are not desirable. This becomes apparent in the following statements, among others: “…if we want to grow wealth across the globe, it's important that we have free trade” or “In case our customers would face tariffs, they are not facing today and that would have a major impact on their quantities, then of course, indirectly, we most likely would also feel that.”
The results of the SAFE Index show a relaxed sentiment among DAX companies so far. Thanks to their global positioning and flexible structures, they feel well prepared for potential US tariffs.
The SAFE Manager Sentiment Index
The SAFE Manager Sentiment Index measures the monthly optimism or pessimism expressed by executives of publicly listed companies in Germany. Developed by Alexander Hillert and his team at the Leibniz Institute for Financial Research SAFE, the Index is based on automated text analysis that evaluates positive and negative statements in financial reports and analyst conferences.
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