market report
After missing the record high the day before, the DAX remains on track towards the 17.00 point mark in the middle of the week. According to experts, it is only a matter of time before the DAX can set a new record.
The DAX remains lurking below the 17,000 point mark in the middle of the week. The broker IG currently estimates the German leading index 0.1 percent lower at 16,963 points. Yesterday, the DAX missed a new record high: Shortly after the start of trading, it rose to 16,999 points – narrowly missing its old record of 17,003 points.
According to some experts, it is only a matter of time before the DAX will reach its record high of 17,003 points. Last week, the German stock market barometer cleared away the last resistance on its way there. With a rise above the old record high, the DAX would send a fresh buy signal; the next starting area would then be at 17,300 points.
Wall Street has mixed guidelines for DAX trading. The Dow Jones index of standard values closed 0.3 percent higher at 38,467 points. The broader S&P 500, however, fell 0.1 percent to 4,924 points, and the Nasdaq technology exchange index lost 0.8 percent to 15,509 points. The Dow and S&P 500 were able to improve their record levels by a few points in early trading.
After the US stock market closed, the focus was on US tech stocks, with two Big Techs, Alphabet and Microsoft, providing insight into their books. While Microsoft was able to benefit from the AI boom, Alphabet suffered from advertising customers’ reluctance. “Now it depends on the other Big Techs,” emphasizes IG analyst Christian Henke. “Any disappointments could trigger a correction in the Nasdaq.” Figures from Apple, Amazon and Meta will be on the stock market agenda in the next few days.
However, what happens next on the stock markets depends not only on how the (tech) reporting season progresses, but also on monetary policy. This evening the US Federal Reserve will announce its next key interest rate decision. Analysts expect the Federal Reserve to leave the key interest rate unchanged at the current range of 5.25 to 5.5 percent.
The subsequent press conference with Fed Chairman Jerome Powell will be exciting. Investors are hoping for initial indications of when central bankers are likely to start cutting interest rates.
The Asian stock markets were unable to agree on a common direction this morning. The Japanese leading index Nikkei just ended trading in Tokyo with an increase of 0.6 percent to 36,286 points. In contrast, the Shanghai stock exchange is currently down 0.8 percent, weak production data from China and the uncertain future of real estate giant China Evergrande are weighing on prices.
In Asian currency trading, the dollar is showing strength ahead of the upcoming Fed decision. At the same time, the euro lost 0.2 percent to 1.0822 dollars. A troy ounce of gold costs $2,035 this morning, 0.1 percent less.
Oil prices fell slightly in early trading. In the morning, a barrel (159 liters) of North Sea Brent for delivery in March costs $82.01, 0.6 percent less. The stronger dollar makes raw materials traded in the US currency more expensive for investors from other currency areas. This usually dampens the demand for the “black gold”.
Deutsche Bank securities are among the biggest losers in early DAX trading. The background to this was a negative analyst opinion, so the US bank Citigroup canceled its buy recommendation for the shares of Germany’s largest financial institution and lowered the price target from 14.00 to 13.40 euros. Deutsche Bank will present its figures for the fourth quarter on Friday.
The software specialist Atoss did better business than expected in the final quarter: the bottom line was that net profit increased by 85 percent to 35.8 million euros. Atoss therefore wants to propose a dividend of 3.37 euros per paper to the shareholders. In the previous year, the group paid out a total of 2.83 euros, which included a special dividend of one euro.
The boom in cloud offerings and products related to artificial intelligence (AI) brought Microsoft an increase in sales of almost a fifth to $62 billion in the last quarter. Profits rose by a third to almost $22 billion. The software company is the most valuable company in the world with a market value of more than three trillion dollars.
Google’s parent company Alphabet, on the other hand, fell short of the market consensus: Google’s advertising business, the Internet company’s main source of income, grew by eleven percent to $65.5 billion in the last quarter – but not quite as quickly as on Wall Street expected. Analysts on average had expected more than $65.8 billion. The share temporarily fell by around four percent in after-hours trading.
Despite the prospect of strong sales of the new special processors for artificial intelligence (AI), AMD has once again delivered an overall disappointing outlook. Because the weak economy is dampening the need for programmable processors for automobiles or medical devices, the chip manufacturer on Tuesday forecast surprisingly low sales of $5.4 billion for the current quarter – plus or minus $300 million.
Elon Musk has to worry about a block of shares worth $56 billion, which makes him the richest person in the world. A judge in the US state of Delaware found that company boss Musk had too much influence in the background when agreeing on the stock allocation plan in 2018 for one to speak of a fair process. In the process, she supported the plaintiff who wants to annul the agreement with Musk.
Despite signs of recovery in the memory chip market, industry leader Samsung again recorded significant losses in profits in the fourth quarter of 2023. The surplus fell by 73 percent year-on-year to 6.3 trillion won (around 4.39 billion euros). Sales fell by almost four percent to 67.8 trillion won. According to calculations by market researchers, Apple displaced Samsung from the top spot among the largest smartphone providers last year.
Music by artists like Taylor Swift or Lady Gaga could disappear from the video app TikTok starting tomorrow. The world’s largest music company Universal Music announced that they could not agree on an extension of the license agreement, which expires on January 31st. TikTok offered musicians and song authors only a “fraction” of the remuneration usual on other similar online platforms and is in fact driving “the replacement of artists with AI”.
The US shopping giant Walmart wants to triple the number of its shares. The company announced a three-for-one stock split after the market closed yesterday. The move is reportedly aimed at Walmart employees. The aim is to make it easier for them to acquire shares as part of the group’s own employee share program.
The Swiss pharmaceutical company Novartis wants to pay out more money to its shareholders in 2023 after a profit increase of 42 percent to almost 8.6 billion dollars. The dividend is to be increased from 3.20 in the previous year to 3.30 francs per share. Novartis also adjusted its medium-term forecast and now expects currency-adjusted sales growth of an average of five percent in the period 2023 to 2028.
The payment service provider PayPal is planning to cut 2,500 jobs worldwide. This corresponds to around nine percent of the workforce, according to a letter from Paypal boss Alex Chriss to the company’s employees, which the Reuters news agency was able to view. PayPal should be downsized through direct cuts and by eliminating vacancies over the course of the year.