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Author: Herbert Rude
FRANKFURT (Dow Jones) – On the European stock markets the weakening of the rate deepens on Wednesday afternoon. The DAX fell 0.9 percent to 14,430 points and the Euro-Stoxx-50 fell 0.6 percent to 3,783 points. “The environment is pointing in the wrong direction,” said one market participant. It points to the continued increase in oil prices. Brent from the North Sea is only slightly below the multi-year highs in early March, which increases the risk of inflation, and in Germany, the price of oil counteracts the effect of tax cuts at gas stations. Bonds are also reacting to this, long-term bond yields are rising to the highest level in several years.
Moreover, investors hold back ahead of Thursday’s meeting of the European Central Bank (ECB): “Interest rates remain the dominant topic on the trading floor,” says market strategist Jochen Stanzl of CMC Markets. After scoring up to 1,400 DAX points in the last few weeks, the consolidation or respite on DAX is now expanding. But there are also more negative voices: “This is and will remain a sawtooth market without trust in the stock exchanges,” says asset manager Thomas Altmann of QC Partners. At least Inditex ended the weak phase of European retail equities with new business data.
The ECB is expected to target the end of negative interest rates on Thursday. With the end of bond purchases and the first two interest rate hikes in July and September, that time may come in late summer.
In line with prevailing concerns about the economy and inflation, the World Bank currently expects global economic growth of just 2.9%. this year, 5.7 percent. last year. In January, she promised 4.1 percent. for 2022. The OECD is also significantly lowering its growth forecast. In Germany, on the other hand, after disappointing orders received the day before in April, production in the manufacturing sector rose in April, but at the level of 0.7 percent. compared to the previous month, it was not very strong and lower than the expected 1 percent.
Inditex gains 5.1 percent. Market participants report the surprisingly good business performance of the Spanish fashion retailer. In addition to unexpectedly high sales, analysts emphasize the dynamic development of margins. H&M gains 1.5% on the Inditex fairway. The retail stock sector index of the pan-European Stoxx world could rise 1.4%. They are followed by the crude oil, technology and car indices, which are slightly increasing. The car shares are benefiting from Renault, which benefited from the launch of its share buyback program with a price increase of 4.8 percent. Technology stocks may hold on well after strong forecasts from Taiwan Semiconductors.
Credit Suisse warns again – rumors of acquisitions support the rate
On the other hand, financial service providers and bank stocks are weak in the market after Credit Suisse again made negative news. The Swiss expect a loss in the second quarter. RBC Capital talks about a negative surprise. Investment banking weaknesses were expected, but weaknesses in other areas of the bank – especially wealth management – were disappointing. While Credit Suisse is recovering from acquisition speculation, UBS is down 2.9%.
At Pernod Ricard (-3%), new weaker growth targets disappoint investors. The spirits producer aims to organic sales growth of 4 to 7 percent between 2023 and 2025. Last year, growth was 9.7 percent. Remy Cointreau was down 2.4 percent, Campari by 1.5 percent and Diageo by 2.3 percent. The food and beverage stock index also fell significantly, by about 2 percent.
Publicis lost 1.9 percent. on the Paris Stock Exchange. The French publisher has lowered its forecast for global ad spend. In the DAX, BMW grew by 1.3 percent, BASF by 1.4 percent and Covestro by 1.6 percent. In turn, Deutsche Post lost 4 percent, and Deutsche Telekom 2.8 percent.
Haldex bull market by SAF-Holland
SAF-Holland lost 5.2 percent. The company has made a full bid to take over Sweden’s Haldex, an increase of 46.5 percent from the previous day’s closing price. After conversion, the total value of the offer is EUR 307 million. SAF-Holland already owns 14.1 percent of the outstanding Haldex shares, 9.2 percent has been acquired by Knorr-Bremse (-1.1%). Haldex hawk in Stockholm down a good 44 percent to 65.10 kronor.
SGL Carbon rose another 11 percent to 7.29 euros. Stifel analysts raised their target SGL price to 11 from 10 euros.
Stock index last + / -% absolute + / -% YTD
Euro Stoxx 50 3 782.91 -0.6% -23.83 -12.0%
Stoxx 50 3 642.49 -0.7% -26.70 -4.6%
DAX 14 429.86 -0.9% -126.76 -9.2%
MDAX 30 157.63 -0.8% -233.95 -14.1%
TecDAX 3,171.64 -0.5% -16.36 -19.1%
SDAX 13 872.27 -0.2% -22.57 -15.5%
FTSE 7,569.25 -0.4% -29.68 + 2.9%
CAC 6 435.61 -1.0% -64.74 -10.0%
Fixed Income Market Last Absolute +/- YTD
10-Year Return from Germany 1.35 +0.06 +1.53
10-year profitability in the USA 3.02 +0.04 +1.51
FOREX last +/-% Tue 9:44 Tue 17:35% YTD
EUR / USD 1.0741 + 0.3% 1.0691 1.0692 -5.5%
EUR / JPY 144.02 + 1.4% 142.31 141.75 + 10.0%
EUR / CHF 1.0463 + 0.5% 1.0417 1.0403 + 0.9%
0.8556 EUR / GBP + 0.6% 0.8506 0.8502 + 1.8%
USD / JPY 134.09 + 1.1% 133.10 132.58 + 16.5%
GBP / USD 1.2554 -0.3% 1.2568 1.2576 -7.2%
USD / CNH (offshore) 6.6894 + 0.3% 6.6757 6.6773 + 5.3%
BTC / USD 30 647.54 -2.3% 30 492.92 29 817.82 -33.7%
ROHL last VT-Settl. +/-% +/- USD% YTD
WTI / Nymex 119.77 119.41 + 0.3% 0.36 + 64.6%
Brent / ICE 121.71 120.57 + 0.9% 1.14 + 61.3%
METALS last day before +/-% +/- USD% YTD
Gold (spot) 1,854.16 1,852.10 + 0.1% +2.06 + 1.4%
Silver (Spot) 22.09 22.23 -0.7% -0.14 -5.3%
Platinum (Spot) 1,011.89 1,014.30 -0.2% -2.41 + 4.3%
The future of copper 4.43 4.44 -0.3% -0.01 -0.6%
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(END) Dow Jones Newswires
June 08 2022 10:12 ET (14:12 GMT)
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