Market report
Status: 07/28/2021 9:44 a.m.
Small profits at the start, but not enough breath to move forward: Although many corporations deliver good quarterly results, consultations by the US Federal Reserve are slowing the market.
With 15,530 points shortly after the start of trading, the DAX can only hold up just above yesterday’s closing level. In any case, it is astonishing that the existing negative factors such as the rising number of new corona infections or the supply chain problems in many industries have been hidden from the stock markets for a long time, commented the Helaba experts in the morning.
Signals from the US Federal Reserve
In view of a booming economy and rising inflation, the US Federal Reserve is advising on its further monetary policy course. The key interest rate, which is already in the extremely low range of 0.0 to 0.25 percent, is unlikely to change. However, the assessment of the economic situation and the increased inflation rate are eagerly awaited at the regular meeting. There should also be further indications of the likely end of the year that economic aid will be shut down. The US economy, the largest economy in the world, is estimated to grow by around seven percent this year.
Overseas specifications weak
On Wall Street, the indices slipped into negative territory in the evening. Technology stocks in particular were under selling pressure. The Dow Jones Industrial closed 0.24 percent weaker at 35,059 points. The S&P 500 fell 0.47 percent on Tuesday to 4401.46 points. The Nasdaq 100 lost 1.1 percent to 14,956.97 points. In Asia, too, the mood on the stock market sank in the morning. The Japanese Nikkei index lost 1.4 percent to 27,682 points. The Shanghai stock exchange was 0.2 percent in the red.
Euro at the 1.18
On the foreign exchange market, the euro is again just above the $ 1.18 mark. In the morning the common currency is quoted at 1.1815 dollars. Oil prices continue to rise slightly. A barrel of North Sea Brent currently costs $ 73.80, half a percent more than yesterday. The gold price, which was around 1804 in early trading, was also slightly up.
Consumer climate in Germany is stagnating
Rising numbers of corona infections are depressing consumer sentiment in Germany. According to the Nuremberg-based consumer research company GfK, Germans’ expectations of the economy and income have not improved. The index determined by GfK for the consumer climate in August was minus 0.3 points and thus remained at the same level as in July. Analysts, on the other hand, had expected an increase in consumer confidence to plus 1.0 points on average.
Deutsche Bank arrives
Shares in the bank react positively to the numbers for the second quarter in the morning. Thanks to the drastically reduced risk provisioning, Deutsche Bank posted its best result since 2015. Before taxes, around 1.2 billion euros were on the books at the end of June. Interest payments for subordinated bonds have to be deducted from the after-tax profit of 828 million euros, so that the Deutsche Bank shareholders’ bottom line was a profit of 692 million euros.
DWS in the stock market boom
The global stock market boom also brought the Deutsche Bank fund subsidiary a profit jump in the first half of the year. The net profit of DWS climbed by 40 percent to 340 million euros compared to the same period in the previous year. Client assets under management rose by 39 billion euros to a record volume of 859 billion euros. All regions in America, Europe and Asia-Pacific contributed to the growth.
Deutsche Börse: Takeovers pay off
The DAX company Deutsche Börse also had quarterly results that evening. The company benefited from the most recent acquisitions in the second quarter. In the three months from April to June, net sales increased by 13 percent to EUR 882 million compared to the previous year. The increase is mainly due to the strong expansion of business outside of the volatile stock markets, among other things through acquisitions. The bottom line was the profit was 311 million euros.
BASF is growing significantly
The chemical company BASF also made a billion profit in the second quarter. The net profit climbed to 1.65 billion euros after a loss of 878 million euros was incurred in the same period of the previous year due to high depreciation. BASF published preliminary quarterly figures at the beginning of July and raised its annual targets. The company expects sales to rise to 74 to 77 billion euros in 2021.
VW subsidiary is in the black
The Volkswagen truck and bus holding Traton also made a profit again in the second quarter. A year ago, the SDAX company had posted a loss of 385 million euros. This time Traton earned 224 million euros after taxes. Traton had already published preliminary figures for the quarter. Sales climbed 61 percent to 7.1 billion euros. Adjusted for one-off effects, the operating result was 612 million euros. Incoming orders for trucks and buses almost tripled to 89,204 vehicles.
Siltronic benefits from semiconductor demand
At the chip supplier Siltronic, the growth rate accelerated in the second quarter. The turnover of the manufacturer of silicon wafers for chip production was 341.1 million euros, almost six percent above the previous year’s figure, as Siltronic announced. Earnings before interest and taxes (EBIT) improved by four percent to 69.6 million euros. For the year as a whole, Siltronic continues to expect that sales will increase by at least ten percent and EBIT will increase significantly. The Munich-based company is about to be taken over by the Taiwanese GlobalWafers.
3G causes losses at Telefonica
Strong customer growth and great interest in its core brand O2 have resulted in higher sales for the telecommunications provider Telefonica Deutschland. In the first six months of the current year, sales increased by 2.9 percent to 3.74 billion euros compared to the same period in the previous year. The bottom line was that the loss in the first half of the year increased from 62 million to 84 million euros: The group had switched off its 3G network earlier than originally planned, so that a higher need for depreciation arose.
European banks on the rise
The British Barclays Bank is resuming its dividend payments after a jump in profits. Thanks to the flourishing investment banking and the elimination of burdens from the Corona crisis, profit before tax tripled to five billion pounds in the first half of the year. In the previous year, Barclays had made a lot of provisions for bad loans due to the Corona crisis, now they have dissolved part of this provision.
The major Spanish bank Santander has also returned to the black after a record loss in the previous year. In the second quarter Santander wrote a net profit of 2.07 billion euros. In the same period of the previous year, the provision for bad loans in particular caused the financial institution a record loss of 11.1 billion euros in the Corona crisis. This time there were no charges.
Tech giants with billions in profits
Yesterday after the US stock market closed, US tech companies presented their balance sheets for the past quarter. In the past quarter, things went as well for Apple as it used to only be during the Christmas season. Revenue jumped a third percent year over year to $ 81.4 billion. The bottom line was a profit of a good $ 21.7 billion left – 93 percent more than a year earlier.
At the Google parent company Alphabet, sales rose in the last quarter by 62 percent year-on-year to around 61.9 billion dollars. The profit jumped to a good 18.5 billion dollars – from almost seven billion dollars a year earlier. Online advertising in Google’s search engine and other areas is still the mainstay of the business.
Microsoft’s revenues climbed in the three months to the end of June by 21 percent year-on-year to $ 46.2 billion. Net income even increased by half to $ 16.5 billion. Microsoft could once again rely on its lucrative cloud services.