After the weak start to the week, concerns about the economy caused further losses for the Dax on Tuesday. With the gas crisis in Europe, the risk of renewed lockdowns in China and ongoing supply chain problems, the negative influencing factors remain diverse.
After the weak start to the week, concerns about the economy caused further losses for the Dax on Tuesday. With the gas crisis in Europe, the risk of renewed lockdowns in China and ongoing supply chain problems, the negative influencing factors remain diverse.
After a weak start, the leading German index widened its minus. Almost an hour after the start of trading, it lost one percent to 12,703.58 points, while the MDax of medium-sized stock exchange companies lost one and a half percent to 25,310 points. The Eurozone leading index EuroStoxx 50 fell by almost 0.9 percent to 3441.79 points.
The losses are “not particularly dramatic, as this can be seen as a necessary act in an effort to form a bottom,” said market analyst Jochen Stanzl from broker CMC Markets. It is important that the Dax no longer slide below its low for the year. There could also be “a strong bear market rally in the stock market at any time, for example if the inflation data from the US give the all-clear.” Stockbrokers understand a bear market rally as a temporary upward movement of the market within an otherwise strong downward trend.
Of interest on Tuesday are the ZEW economic expectations of the financial experts. Dekabank expects a significant decline. The US inflation data, which are expected on Wednesday, are also moving more into focus. Unlike Stanzl, the Dekabank experts fear that prices in June may have risen even more sharply than in May compared to the previous month, when they “cause a moderate earthquake on the capital markets”. In addition, the US quarterly reporting season is already casting its shadow – the banks JPMorgan and Morgan Stanley will present figures on Thursday.
In the Dax, the BASF shares, which were already weak the day before, lost 1.1 percent in line with the market according to quarterly figures. Thanks to price increases and the weak euro, the chemical company performed better than analysts had expected and confirmed its annual targets. Goldman analyst Georgina Fraser noted that investors are more likely to take the numbers as a look in the rear-view mirror given the difficult environment. They could also criticize that the Nutrition & Care area was disappointing and that the positive surprise was heavily influenced by the Other category.
The recently shaken Uniper shareholders also had to cope with further price drops in the MDax: The shares of the ailing gas supplier fell by more than three percent and remained only slightly above the record low of the previous day, to which they had fallen in view of the feared gas stop from Russia.
In view of rising interest rates, real estate values were under the most pressure in Europe, as the sub-index in the broad Stoxx Europe 600 showed. A downgrade at Grand City Properties also weighed on performance. The shares lost more than five and a half percent and were as cheap as they were last in 2015. The US investment bank Goldman Sachs canceled its buy recommendation for the residential real estate group as part of a skeptical industry study and now recommends the share as “neutral”.
Meanwhile, the implementation of the capital increase has begun at industry colleague TAG Immobilien, which is also listed in the MDax. The shares are traded without subscription rights. For every 101 old shares, the shareholders received a right to acquire 20 new shares. If you want to make use of your subscription right, you have to pay an additional EUR 6.90 for the new paper. The subscription rights were traded at EUR 0.38 in the morning and the TAG shares at EUR 8.82 – a total of EUR 9.20. Compared to the Xetra previous day’s close of 9.48 euros, there is a mathematical minus of almost three percent.
On Thursday, TAG announced that it would issue around 29 million new shares to partially refinance the takeover of the Polish real estate company Robyg. This corresponds to almost a fifth of the shares outstanding to date. This should bring in around 200 million euros. Since then, the share price has fallen significantly to its lowest level since the turn of the year 2014/15.
Source: Stern
Jane Stock is a technology author, who has written for 24 Hours World. She writes about the latest in technology news and trends, and is always on the lookout for new and innovative ways to improve his audience’s experience.
