The DAX 40 was flat to lower around 24,960 in the first trading session of July, as investors locked in profits following a robust Q2 performance while maintaining a cautious stance.
The AI-driven tech rally lost momentum, and peace talks between the US and Iran hit a new stalemate after Tehran said it would not meet with US officials in Doha.
Meanwhile, all eyes are on Sintra, where speeches by Fed President Kevin Warsh and ECB President Christine Lagarde are expected later in the day.
AI-related stocks, retailers, and banks were among the hardest hit, while defense stocks led gains.
Adidas (-1.7%) was at the bottom of the index, tracking losses in the US following cautious statements on expected revenue in the coming quarters.
Hochtief, Siemens, Vonovia and Siemens Healthineers were also among the laggards, down more than 1% each.
On the upside, Rheinmetall outperformed, rising 3.2%, amid reports that Germany aims to ramp up domestic weapons production.