Zalando shares have staged a notable recovery in European trading, reversing the sharp sell-off that followed the announcement of a formal investigation by Germany's financial regulator, BaFin.
The rebound suggests that investors are starting to digest the regulatory news and are focusing on the company's long-term operational adjustments rather than short-term headlines.
The German e-commerce giant has faced a series of headwinds in recent weeks.
BaFin opened a probe into Zalando's annual financial statements and management report, casting a shadow over the company's governance.
Simultaneously, the company announced it would close its logistics center in Erfurt by the end of September, alongside rumors of job cuts in its Berlin headquarters.
These developments initially spooked the market, driving the stock to multi-month lows.