German stocks traded higher on Thursday as softer-than-expected U.S. economic data fueled speculation that the Federal Reserve could slash interest rates in September.
The upside remained capped after official data showed German factory orders logged an unexpected decline in May due to the decrease in foreign demand.
Factory orders declined 1.6 percent month-on-month in May, sharper than the revised 0.6 percent decrease in April, Destatis reported.
This was the fifth consecutive decline and also came in contrast to economists\' forecast of 0.5 percent growth.
Year-on-year, new orders registered a sharp 8.6 percent decline in May compared to a moderate 1.8 percent drop in April.
The benchmark DAX was up 79 points, or 0.4 percent, at 18,453 after rallying 1.2 percent in the previous session.
In corporate news, Nordex SE shares rose over 2 percent after an announcement that DenkerWulf has ordered seven N149/5.X turbines.