Investors reduce risk: DAX between euphoria and depression


market report

Status: 5/24/2022 12:49 PM

ECB president Christine Lagarde is fueling fears of more aggressive monetary policy of the central bank and the DAX broke the recovery rate. Once again, it is said: easy to win, easy to lose.

The DAX lost almost one percent by noon and was trading at around 14,050 points. At times it dropped to 13,986 points, so below the technically significant value of 14,000 points. It has been proving for many days that this is a barrier that is difficult to overcome in the long run.

The leading German index closed yesterday up 1.4 percent to 14,175.40 points. “One day market participants get euphoric and suppress well-known stress factors. And not long after that, the good mood suddenly disappeared ”- this is how Christian Henke from Broker IG experiences this trading phase.

Growth is slowing down due to numerous crises and rising inflation is forcing central banks to adopt restrictive policies. Market observer Jürgen Molnar of the RoboMarkets brokerage house describes the situation as it worsens the financing conditions and hence the risk attitude of investors.

The current economic data is positive

There is positive news on the economic side in Germany: the German export industry is expecting slightly better business again. The index of export expectations of the Munich Ifo Institute rose in May to 4.5 points after 3.0 points in April.

In addition, the index of purchasing managers for the private sector, industry and the service sector combined rose 0.3 to 54.6 points in May, S&P Global announced in a monthly survey of approximately 800 companies. Experts expected a decline.

It should be noted that in the current phase, characterized by expectations for interest rate hikes, the DAX cannot really benefit from positive economic data, commented Helaba’s experts. This is also due to the fact that sound economic data give the ECB more room for maneuver to pursue tightened monetary policy in the fight against inflation.

Update the economy from 5/24/2022.

Stefan Wolff, HR, tagesschau24, May 24, 2022

Lagarde supports the euro

The euro, on the other hand, is in an uptrend, breaking above $ 1.07. ECB president Christine Lagarde promised yesterday the end of negative interest rates in late summer. The reason for the tightening is high inflation, to which the ECB has to react. Investors seem to be preparing for a more aggressive monetary policy.

Today Lagarde spoke about the economy in the euro zone: The head of the central bank does not assume a recession: According to Lagarde, the economic slowdown is not the main scenario for the central bank at the moment – the path to interest rate increases would be clear at the moment.

However, the rising euro makes goods from Germany more expensive for countries outside the euro area. This, in turn, could strain many export-oriented companies.

The prosecution investigation against Adler?

The stocks of the Adler Group are falling sharply today. The public prosecutor’s office in Frankfurt has now opened an investigation, Handelsblatt reports, citing informed individuals. The public prosecutor’s office in Frankfurt did not want to confirm or deny the investigations. The Federal Financial Supervisory Authority (BaFin) is currently examining Adler’s books. The agency intervened after a real estate firm first came under fire from short-term saleswoman Fraser Perring in October.

It and his research team, Viceroy, have raised serious allegations against Adler, including the appraisal of real estate projects. The company has denied the allegations. Meanwhile, Adler also needs to look for new auditors after KPMG is not available for the 2022 annual and consolidated financial statements.

Billions Invested by Samsung

South Korean electronics group Samsung plans to invest 450 trillion won (334 billion euros) over the next five years to boost its semiconductor and biopharmaceuticals business. As reported by Samsung, investments are 30 percent. higher than in five years to 2021. Securing domestic chip and biotech supply chains is of strategic importance and is important to South Korea’s economic security, Samsung said.

Higher rents continue to drive TAG Immobilien

TAG Immobilien continues to benefit from rising rents in urban areas. In the first quarter, the operating result (FFO 1) rose by almost five percent year-on-year to 47.8 million euros. Rents excluding taxes increased by 1.4%. up to EUR 84.3 million. Due to transaction costs related to the purchase of Polish residential developer Robyg, the consolidated result fell by a good six percent to EUR 32.3 million.

CTS Eventim: Ticket sales at a record level

With the lifting of the restrictions on the crown, the concert organizer and ticket seller grew strongly in the first quarter. Sales increased to around EUR 140 million after almost 20 million a year ago, and the normalized operating result (EBITDA) reached EUR 23.7 million, down almost 20 million. “The concert halls and festival grounds are finally coming to life again. A strong start to the year gives us every reason to be sure that this year we will experience a powerful live relaunch, ”said company boss Klaus-Peter Schulenberg. In April and May, ticket sales significantly exceeded the record values ​​from before the crisis of 2019.

Airbnb is largely discontinuing operations in China

Airbnb’s vacation rental platform largely ends its operations in China. The company will no longer offer accommodation or “experiences” to visitors to China, reports the news agency AFP. However, Chinese users should still be able to book accommodation overseas. The company declined official comment.

The platform is facing stiff competition in China. In recent years, the harsh isolation measures taken by the Chinese government during the koruna pandemic have also made it difficult to do business.

Zoom Video unfolds as slowly as when it was released to the public

The US video service Zoom grew just as slowly in the first quarter as it did when it went public in 2019. Sales rose twelve percent to $ 1.07 billion. For some time now, stiff competition from Cisco WebEx, Salesforce Slack, Microsoft Teams and Google Meet has slowed the growth of Zoom. Like its competitors, the company is taking advantage of the tendency to flexibly work between home and office, but not as much as at the start of the corona pandemic.

Snap sees quarterly goals at risk

The makers of the Snapchat photo app have shocked investors with their forecasts for the current quarter: the share of after-hours trading has dropped by around 31 percent. Snap said it likely missed its sales and operating profit targets. Since the forecast from a month ago, the economic environment has continued to deteriorate – faster than expected. Co-founder and CEO Evan Spiegel is now looking to save more.

Electronic Arts before the takeover?

Video game developer Electronic Arts may be acquired. The American portal “Puck News” reported that preliminary talks with large media groups had taken place. Disney, Apple and Amazon are reportedly among the potential buyers. Comcast CEO Brian Roberts turned to Electronic Arts and proposed a spin-off with NBCUniversal, followed by a merger of media and gaming giants.

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