DAX before a weak start to the week: breathing space for investors

Market report

Status: October 18, 2021 8:20 a.m.

After the price rally of the past four days, investors should relax a little today. Experts expect the DAX to fall back slightly.

Banks and brokers expect the DAX to start a few points easier today. It would not be unusual for investors to pause, because last week it had risen from just over 15,000 points to almost 15,600 points in just four trading days.

On Friday, the leading German index went out of trading by 0.8 percent to 15,587.36 points, which corresponds to a weekly plus of 2.5 percent. Strong bank balance sheets and a surprising increase in retail sales had created a friendly mood in the USA, which was then carried over to the European indices.

The balance sheet season is really picking up speed this week, so investors are hoping for fresh impetus for the stock market from companies. “The start of the US reporting season whets the appetite for more,” says market expert Timo Emden.

Nevertheless, the known risk factors remain. Investors will continue to be concerned about high energy and raw material prices as well as inflation and supply chain problems. The subject of the heavily indebted Chinese real estate giant Evergrande is also virulent.

Investors hope that “most things will be balanced again and that the companies will somehow cope with the difficulties by then,” believe experts from the Landesbank Baden-Württemberg (LBBW). “After all, the big picture is not as bad as the problems outlined suggest, as a look at the full order books shows.”

Wall Street had again delivered good targets at the end of the week: The Dow Jones index had risen by 1.1 percent to 35,294 points. The broader S&P 500 climbed 0.8 percent to 4,471 points. The index of the technology exchange Nasdaq rose by 0.5 percent to 14,896 points.

In Asia, however, investors are cautious at the start of the week. Current data on the growth of China’s gross domestic product (GDP) in the third quarter were disappointing today with an increase of 4.5 percent compared to the previous year. The People’s Republic had to struggle with power and supply bottlenecks, regional virus outbreaks and growing nervousness and regulation in the real estate sector.

The Nikkei index, which comprises 225 values, was listed 0.3 percent lower at 28,988 points before the close of trading. The broader Topix index fell 0.4 percent and stood at 2017 points. The Shanghai stock exchange lost 0.2 percent. The index of the most important companies in Shanghai and Shenzen lost 1.2 percent.

The software provider Teamviewer, which has been under great pressure on the stock exchange in the past few weeks, is looking for a new CFO. The previous CFO, Stefan Gaiser, will leave the company by mutual agreement when his contract expires in 2022, said the MDAX-listed company: “In order to ensure a smooth transition, the Supervisory Board has already started the process of looking for a successor.”

The contract of CEO Oliver Steil, on the other hand, will be extended until October 2024. The two managers were recently criticized because the share price has fallen sharply in recent weeks and months. The company’s market capitalization, which has been listed on the stock exchange for around two years, fell this year by almost 70 percent to 2.8 billion euros. The reasons for this include doubts about the growth prospects and expensive sports sponsorship contracts that reduce profitability.

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