Market report
Status: 07/21/2021 7:59 a.m.
After the slump on Monday, the DAX is likely to remain on a recovery course and rise slightly at the start of trading. Investors do not expect big leaps because of the ongoing corona worries.
The DAX still has to nibble at its setback at the beginning of the week. Today, however, it should stabilize further: the broker IG estimated the German benchmark index 0.1 percent higher to 15,231 points around two hours before the start.
On Monday it was temporarily down to 15,048 points, but had just kept the upward trend since the Corona low in March 2020. “It will remain a buy-the-dip market for the time being,” said portfolio manager Thomas Altmann from QC Partners. Setbacks would therefore always be used to get started. This is especially true for the USA.
Wall Street is back
There Wall Street showed a strong reaction to the weak Monday. The major indices all rose significantly and made up most of their losses. Above all, the leading index Dow Jones, which at the beginning of the week fell below the 34,000 mark for the first time since the end of June, rose by more than 1.6 percent. It closed yesterday at 34,511 points and remains within reach of its record high of 35,092 points.
The Nasdaq also went up 1.57 percent to 14,498 points, the Nasdaq 100 selection index also recovered significantly to 14,728 points – a daily gain of 1.23 percent. The broader S&P 500 benchmark index advanced 1.52 percent to 4323 points.
DAX closes slightly in the plus
In the wake of Wall Street, the DAX also turned positive with a daily gain of 0.55 percent and closed at 15,216 points. However, he had previously given up his initial winnings by the afternoon and even slipped slightly into the red.
“In this country, skepticism is still significantly greater than on the other side of the Atlantic,” said Altmann. He is now generally assuming greater fluctuations in the summer. A return to the quiet trading of the previous weeks is unlikely.
Investors do not expect big jumps upwards today because of the ongoing corona worries. The fear of the delta variant intensifies economic worries and a slowdown in the global economy – despite the ongoing vaccination campaigns. Today the focus is on the two DAX groups SAP and Daimler.
Economic data from Japan boost Asian stock exchanges
Asian stocks have also largely made up for the losses they suffered at the beginning of the week. Sentiment in Japan was buoyed by a surge in exports in June. Solid demand for automobiles in the US and chip manufacturing plant shipments to China raised hopes for an economic recovery.
The Nikkei index, which comprises 225 values, was 0.8 percent higher at 27,592 points. The broader Topix index rose 0.9 percent and stood at 1906 points. The Shanghai stock exchange was up 0.4 percent. The index of the most important companies in Shanghai and Shenzen gained 0.4 percent.
Software giant SAP raises outlook for full year
The fact that its customers are moving to the cloud more quickly makes the software giant more confident. The Walldorf Group is therefore raising its outlook for the full year for the second time. The biggest growth driver in the second quarter was again the cloud business, while sales of conventional software licenses continued to decline. In the second quarter, the Group’s total sales of 6.7 billion euros were one percent below the previous year’s figure. Adjusted operating profit, with a decline of two percent to 1.92 billion euros, was slightly better than analysts had anticipated. Without the effect of the exchange rate, sales and operating profit would have increased by three percent.
Klein also referred to strong growth in new contracts for the new “Rise with SAP” cloud offering, especially in the USA. The bottom line was that SAP earned 1.45 billion euros, almost two thirds more than a year earlier. Once again, SAP’s investments in start-ups through the venture capital vehicle Sapphire Ventures, which according to CFO Luka Mucic contributed 900 million euros to the financial result in the second quarter alone, played a decisive role.
Daimler increases net profit despite headwinds from lack of chips
In the past quarter, despite the corona uncertainty and the chip crisis, the bottom line was that Daimler made a billion-dollar profit. The car and truck manufacturer achieved a group result of 3.7 billion euros thanks to strong sales growth from April to June, as the Dax company announced on Wednesday. A year ago, a loss of 1.9 billion euros was incurred due to the slump in sales in the corona pandemic.
The shortage of computer chips, from which the entire auto industry is currently suffering, will, however, dampen sales in the second half of the year. Daimler therefore lowered its forecast for sales: This is only expected to be at the previous year’s level and no longer significantly higher. As before, sales and operating profit are forecast to be significantly higher than the previous year.
Netflix growth stagnates
The streaming giant Netflix was able to attract fewer new users with its series and films in the second quarter than ever before in a quarter. In the three months to the end of June, the global number of subscribers only increased by 1.5 million to a total of 209 million, as the company announced on Tuesday after the US market closed. The forecast for the current quarter was also relatively meager with 3.5 million new customers. The streaming market leader is under pressure in the face of increased competition and now wants to expand into new markets. After the trading hours, the share initially reacted with significant price drops.
However, Netflix boss Reed Hastings does not believe that people will lose their interest in streaming after the pandemic. “The growth story remains intact, at least for the next few years,” he said in a video interview. Even in the face of streaming competitors like Hollywood giant Walt Disney and other financially strong rivals like WarnerMedia with the popular pay channel HBO (“Game of Thrones”) or Amazon, who want to strengthen themselves through mergers and acquisitions, Hastings remains calm. “We don’t see any major headwinds from new streaming competitors.”
Tesla wants to open the charging network for other e-cars
The electrical manufacturer also wants to make its fast charging stations accessible for electric vehicles (EV) from other manufacturers. “We’ll open our Supercharger network to other EVs later this year,” said CEO Elon Musk. Tesla’s network of over 25,000 charging stations around the world had given the company a competitive advantage in the industry-wide race for supremacy in the fast-charging standard.