At the start of the new trading week dominated by the key interest rate decision in Europe, the German stock market has recovered. In early trading on Monday, the leading German index extended its gains in the first hour of trading and was most recently up 0.68 percent at 15,847.24 points. The MDax of medium-sized stocks also gained after its weaker previous week and advanced by 0.71 percent to 27,251.83 points. The Eurozone leading index EuroStoxx 50 recently rose by 0.8 percent.
At the start of the new trading week dominated by the key interest rate decision in Europe, the German stock market has recovered. In early trading on Monday, the leading German index extended its gains in the first hour of trading and was most recently up 0.68 percent at 15,847.24 points. The MDax of medium-sized stocks also gained after its weaker previous week and advanced by 0.71 percent to 27,251.83 points. The Eurozone leading index EuroStoxx 50 recently rose by 0.8 percent.
From the point of view of the experts at Landesbank Hessen-Thüringen (Helaba), in view of the key interest rate decision by the European Central Bank (ECB) this Thursday, there is a risk that prices could fluctuate more in the coming days. In view of rising economic concerns and stubbornly high inflation, experts are debating whether there will be another interest rate hike or whether the European monetary authorities will take a break.
On the company side, the Covestro shares stood out at the top of the Dax early in the morning with significant price gains; they further expanded their Friday gains with a plus of 3.7 percent and reached another high since February 2022. The chemical company had already announced on Friday evening that after weeks of speculation about interest from Abu Dhabi National Oil (Adnoc), he will now hold open-ended discussions with the oil company about a possible takeover. Recently there was talk in the media that the Arabs had informally promised 60 euros per share, which corresponds to a value of 11.6 billion euros. However, analysts at Baader Bank and Barclays consider the reported sum to be too low.
Across Europe, banks and real estate stocks were very popular with investors before the ECB decision. In this country, shares in Deutsche Bank climbed by 2.3 percent, Commerzbank shares followed at some distance with a 1.3 percent premium. Shares in the landlord Vonovia rose by two percent, and things went even better for LEG Immobilien and Tag Immobilien, each with an increase of more than 2.2 percent.
One of the few losers in the leading German index was Siemens, with minus 0.6 percent, which suffered from negative analyst opinions. The British HSBC, for example, canceled its buy recommendation for the technology group and significantly reduced its price target; and the experts at Barclays Bank recommended in an initial classification that investors should better underweight the value in their portfolio (“underweight”).
Siemens is a victim of its own success, wrote analyst Vladimir Sergievskiy. The peak order and margin environment is normalizing, free cash flow is likely not as good as the market perceived, and new bold structural actions appear complex or unlikely.
Source: Stern
