Market Report: Investors are becoming bolder |

 Market Report: Investors are becoming bolder |

market report

With a tailwind from New York in its luggage, the DAX is targeting the 16,000 point mark, just like the day before. The odds aren’t too bad as the much-anticipated US consumer price data for July came in slightly better than expected, with inflation rising to 3.2 percent. Experts had expected a slightly stronger price dynamic of 3.3 percent.

Wall Street is reacting positively, which is also supporting the DAX. The leading German index has already looked over the round mark at the daily high of 16,013 points. He is currently struggling with the thousand mark – and gaining around 1.0 percent.

Major US indices open stronger in unison after encouraging price data. The Dow Jones leading index gained almost 0.8 percent, and the Nasdaq technology exchange also gained around 1.0 percent.

Investors are thus reacting positively to the new inflation data, although it rose slightly from the previous rate of 3.0 percent to 3.2 percent yoy. According to Landesbank Hessen-Thüringen (Helaba), the slight increase in the overall inflation rate should not be overestimated.

“The development in the preliminary stages gives hope that the downward trend will continue in the coming months,” commented Helaba economist Ulrich Wortberg. Some experts are now increasingly betting that the US Federal Reserve will not raise its key interest rate any further. According to Wortberg, the data should not put pressure on the Fed to raise interest rates further. Especially since the initial jobless claims published at the same time have increased more than expected.

According to Dirk Chlench, economist at Landesbank Baden-Württemberg, the Fed’s rate hike course has reached the “end of the road”. Interest rate cuts are already expected for the first half of 2024.

On the foreign exchange market, the euro reacts to the US price data with price gains. In the afternoon, $1.1032 is paid, up around half a percent against the greenback. The reason for this is that the “interest rate fantasy” for the dollar is fading. Oil prices are falling slightly, but remain at a high level.

Another topic on the stock market today is the progress of the domestic reporting season. A number of DAX companies published their second quarter balance sheets and business outlook this morning. Different price reactions are the result.

The Allianz share and the shares of the reinsurer Munich Re are among the biggest DAX winners. Allianz has reiterated its full-year earnings guidance after gains in the second quarter. The operating result should now reach 14.2 billion euros. In the second quarter, earnings increased by 7.1 percent to 3.8 billion euros, which was slightly above analysts’ estimates.

At Munich Re, consolidated profit fell by 21 percent to EUR 2.43 billion in the first half of the year, after EUR 3.066 billion in the same period of the previous year. However, the group confirmed its forecast, according to which the group result should reach 4.0 billion euros in the current year. In the wake of Munich Re shares, Hannover Re, which is also listed on the DAX, also made gains.

In contrast, the Siemens share slipped to the end of the index. In the three months to the end of June, the group’s revenues increased by six percent to almost 18.9 billion euros. However, growth weakened compared to the previous quarter. The bottom line is that Siemens achieved a profit after taxes of 1.4 billion euros. Shares in the subsidiary Siemens Energy also slip in the DAX percent.

The focus was on the weaker development of the Digital Industries division, which bundles the business with the digitization of industry. This had grown by leaps and bounds in the past two years and, according to analysts, is now showing a normalization. Overall, Siemens confirmed the targets for the fiscal year, but expects lower sales growth in Digital Industries than before. The margin here is also likely to be slightly lower than originally projected

The consumer goods manufacturer Henkel continues to grow thanks to price increases and is increasing its forecasts for the current year. Group sales for the first six months were EUR 10.9 billion. This corresponds to organic growth of 4.9 percent. Adjusted earnings before interest and taxes (EBIT) climbed 7.6 percent to 1.25 billion euros. For 2023, the DAX member Henkel expects organic sales growth of 2.5 to 4.5 percent. The adjusted EBIT margin should now be between 11 and 12.5 percent.

The sales of the armaments group Rheinmetall climbed in the second quarter by 6.4 percent to almost 1.5 billion euros. The operating result increased by 3.5 percent to 118 million euros. Both metrics were in line with analysts’ expectations. All in all, Rheinmetall made a profit of 73 million euros, as in the same period last year. According to the company, the order books are well filled.

The T-Share has now clearly limited larger losses initially. Deutsche Telekom expects earnings before interest, taxes, depreciation and amortization including leasing costs (Ebitda AL) of EUR 41.0 billion for 2023. This is slightly more than previously expected. Telekom won 319,000 mobile customers under its own brands in Germany in the second quarter – almost two-thirds more than analysts had expected. At Group level, sales in the second quarter fell by 2.4 percent year-on-year to EUR 27.2 billion.

Furthermore, the US business accounts for the lion’s share of the balance sheet. As CEO Höttges announced, Telekom held 51.3 percent of T-Mobile US at the end of June. “We are happy to hold the majority of the most valuable mobile phone company in the world,” he said when presenting the quarterly figures. The manager denied a possible dependence on overseas companies. Deutsche Telekom only has so much scope for investments because of its strong business in America. “I say with complete conviction: I would do everything the same way again in the USA,” he said. In the first half of the year, the group spent 9.2 billion on investments.

The recipe box mail-order company had to accept a significant drop in demand in the past quarter due to the global slump in consumption. The number of orders fell by seven percent to 30 million. However, thanks to strict cost control, the meal kit supplier increased earnings before interest, taxes, depreciation and amortization (Ebitda) adjusted for special effects by almost a third to almost 192 million euros. Sales fell slightly to 1.92 billion euros as a result of weaker customer interest.

Pilot strikes at Lufthansa are off the table in the coming years: the pilots’ union Cockpit announced today that a large majority of its members had voted in favor of a tariff package negotiated at the end of July.

According to media reports, a salary increase of 7.5 percent from 2024, a one-off tax-free inflation premium of 3,000 euros and improvements to the service structure were agreed in the negotiations. According to Cockpit, the contracts run until the end of 2026. The Lufthansa share has increased by more than one percent in the MDAX.

The chemical group Evonik is suffering from the weak economic development in Germany. The company’s operating result collapsed in the second quarter by 38 percent to 450 million euros. “Strict austerity measures” had a positive effect on earnings, explained company boss Christian Kullmann. Overall, Evonik made a loss of €270 million as a result of €390 million in impairments on assets in Europe and North America.

Despite significant growth in sales and earnings, the SMA share slipped by more than eight percent in the TecDAX. The results appear to have fallen short of market expectations. With an increase in sales of around 65 percent to 778.9 million euros, the operating result (Ebitda) shot up to 125.3 million euros, compared to 15.9 million euros a year ago.

Papers from the forklift manufacturer Jungheinrich in the MDAX are also losing significantly. According to traders, the market was expecting more than a confirmation of the full-year guidance. Jungheinrich has grown despite the economic downturn and is also benefiting from an acquisition. Sales increased by 21 percent to 2.658 billion euros, the operating result (EBIT) by 46 percent to 236 million euros.

The declining demand for sea transport caused the turnover and profit of the Hamburg-based container shipping company Hapag-Lloyd to collapse in the second quarter as well. The consolidated result fell to a good one billion euros, a drop of around 75 percent. Sales halved to about 4.42 billion euros. The reason is the normalization of the supply chains on the oceans, which have been disrupted for years. According to Hapag-Lloyd, the average freight rate fell in the second quarter from $2,935 to $1,533 per standard container.

US entertainment giant Disney halved its video streaming losses last quarter. However, the division with the Netflix competitor service Disney + still posted operating figures of 512 million dollars (466.5 million euros). In the past quarter, the division’s revenues fell 7 percent to $6.7 billion. Operating income fell 23 percent to $1.9 billion.


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