market report
Status: 06/01/2022 09:35 a.m
Regardless of yesterday’s losses, the DAX is maintaining its slight upward trend today. In the middle of the week things are picking up again – despite weak targets from overseas and sensitive economic signals.
The German stock exchange barometer started trading in the morning with a price gain of almost half a percent and thus at 14,450 points. The DAX has thus made up for a large part of yesterday’s losses.
Specifications rather mixed
In New York ging der Dow Jones yesterday with minus 0.7 percent at 32,990 points from trading. The technology-heavy Nasdaq 100 was also unable to maintain its interim gains and finally fell by 0.3 percent to 12,642 points. In Asia, too, not all stock exchanges made it into the profit zone in the morning. The Japanese Nikkei index closed 0.7 percent higher at 27,458 points. The Shanghai stock exchange, on the other hand, was down 0.2 percent.
China’s economy with question marks
Activity in China’s manufacturing sector contracted for the third month in a row in May, according to a major economic barometer. However, the Purchasing Managers’ Index (PMI) of the business magazine “Caixin” rose slightly from 46 points in the previous month to 48.1 points. Analysts note positively that the lockdown in the economic metropolis of Shanghai has largely ended. Despite the lifting of the rigid restrictions, however, numerous measures for the 25 million residents of Shanghai remain in place. Visiting restaurants remains prohibited and shops are only allowed to work at 75 percent of their capacity.
Uncertainty about Fed strategy
In the USA, uncertainty about the further monetary policy of the US Federal Reserve (Fed) remains high. Fed executive Christopher Waller had spoken out in favor of raising interest rates by half a percentage point beyond the summer. In the evening the Fed presents its so-called “Beige Book”, the monthly economic report.
German retail is shrinking
Sales in German retail plummeted in April. Adjusted for seasonal and price effects (real), revenues fell by 5.4 percent compared to March, as reported by the Federal Statistical Office. The nominal decrease was 4.7 percent. Sales in food retailing have fallen the most, with a real minus of 7.7 percent compared to March. Trade in non-food items shrank by 4.4 percent in real terms.
Euro struggles with strong dollar
On the foreign exchange market, the euro held just below the $1.07 mark in the morning. “In the USA, expectations of rapidly and sharply rising key interest rates are dominating,” say the analysts at Landesbank Hessen-Thüringen. This was fueled not only by the high rate of inflation and the recent solid economic development, but also by the Fed representatives. The prospect of multiple rate hikes in the US tends to strengthen the US currency.
OPEC+ without Russia?
Yesterday’s price increases on the oil market have calmed down again. The price for a barrel of North Sea Brent oil is $116.50 in the morning. The behavior of the members of the Opec+ oil cartel, which includes not only the Opec countries but also Russia, is now coming into focus. According to the Wall Street Journal, the oil production agreement with Russia could be suspended. Western sanctions would undermine the country’s ability to produce more crude oil to meet the Verbund’s production targets. Shutting out Russia could mean Saudi Arabia producing more oil sooner than planned.
SAP in the front, Zalando in the back
In the DAX, the SAP share is one of the biggest gainers. The title benefits from good profit prospects of US competitor Salesforce. Its shares had risen significantly in the United States on the evening after an increased forecast was announced. After a negative analyst comment, the Zalando share falls by around three percent. The British investment bank Barclays downgraded the stock from “Overweight” to “Equal Weight” and lowered the price target from 52 to 48 euros.
Vonovia wants to increase rents
The DAX group Vonovia holds in view of the high inflation rates more significant rent increases are inevitable. “If inflation is permanently at four percent, rents will have to increase accordingly every year in the future,” said Vonovia boss Rolf Buch to the “Handelsblatt”. Otherwise, many landlords would get into serious trouble. The real estate giant owns around 565,000 apartments, most of them in Germany. The average rent at Vonovia rose to EUR 7.40 per square meter in the first three months of this year – that was 3.1 percent more than a year earlier.
DWS under pressure after change of boss
The share of Deutsche Bank subsidiary DWS in the SDAX slipped significantly. DWS, which is under pressure because of “greenwashing” allegations change their boss. Stefan Hoops will be appointed as the new CEO at the general meeting on June 10, DWS announced. The previous boss Asoka Wöhrmann will resign his mandate on the same day. Stefan Hoops comes from the parent company, where he worked as head of the corporate bank of Deutsche Bank. Yesterday, searches took place at Deutsche Bank and DWS. The public prosecutor’s office, the financial supervisory authority BaFin and the Federal Criminal Police Office (BKA) were involved.
Siemens Gamesa does not rule out layoffs
The new boss of the troubled wind energy company Siemens Gamesa is preparing the workforce for cuts. Job cuts or the closure of plants are possible, according to Jochen Eickholt in an interview with the “Handelsblatt”. Management is currently considering how best to reduce costs. Eickholt announced more detailed statements on the restructuring of the ailing subsidiary of Siemens Energy for the end of July and beginning of August. However, a sale of the onshore division is currently not an issue.
Tesla supplier Panasonic with chip shortage
The Japanese Tesla supplier Panasonic expects the auto industry to recover this year, but fears a persistent shortage of chips. “We will continue our business taking into account the risks of fluctuations in vehicle production,” said Auto Division chief Masashi Nagayasu. The company, which generates around 14 percent of its total sales with the automotive division, expects sales in this area to increase by 19 percent in the current financial year.