market report
Investors will probably have to survive another weak trading day. The leading German index is again expected to make losses. Weak economic data from China and interest rate fears continue to have a negative impact.
The index is expected to be at 15,700 points at the start of trading on XETRA, according to pre-market indications. That would be a further minus of 0.5 percent. Yesterday, the DAX lost 0.9 percent to 15,767 points.
Weak economic data from China continue to weigh on the stock markets. Yesterday, the government lowered the key interest rate again in order to stimulate the economy. At the same time, declining growth in industry and retail was reported in the world’s second largest economy.
Wall Street also reacted to the signals from China with losses. The Dow Jones index of standard values closed one percent lower at 34,946 points. The tech-heavy Nasdaq fell 1.1 percent to 13,631 points. The broad S&P 500 lost 1.2 percent to 4437 points.
In the US, there are concerns that interest rates could remain at current high levels longer than previously expected after US retailers posted a stronger-than-expected 0.7% month-on-month sales increase in July, suggesting that the US economy remains robust. Tonight the “Fed Minutes”, the minutes of the last meeting of the US Federal Reserve, are due for publication. There could be indications of further US monetary policy here.
In Asia, too, the courses are slipping in the morning, especially with a view to China. “Investor sentiment towards China is pretty bad,” said Redmond Wong, China Market Strategist at Saxo Markets. The Japanese Nikkei index was one percent lower at 31,903 points. The Shanghai stock exchange was down 0.7 percent.
On the foreign exchange market, the euro lost significantly against the dollar yesterday. The common currency is now trading at $1.0915 after last hovering around the $1.10 mark. The prospect of a weaker Chinese economy is weighing on oil prices. The price for a barrel of North Sea Brent is currently $84.30, about half a percent below yesterday’s level. A troy ounce of gold currently costs $1,904.
Bank stocks could be the focus on the German stock market. On Wall Street, the prospect of a possible downgrading of the credit ratings of some major US banks by the rating agency Fitch had weighed on them in the evening. Shares in JP Morgan, Bank of America, Citigroup, Goldman Sachs and Wells Fargo fell significantly. The rating agency could lower its rating of the financial institutions if it had to correct its assessment of the environment for the banking sector further downwards, Fitch analyst Chris Wolfe told US broadcaster CNBC.
The reporting season for the second business quarter is also slowly ending in Germany. In the morning, only the real estate group Grand City Properties had presented its balance sheet. The operating result fell by three percent compared to the same period of the previous year to 94 million euros. The bottom line is that the real estate group made a loss of almost 402 million euros due to a lower revaluation of the real estate portfolio. However, the company is more confident about the operating result in the current year. Company boss Refael Zamir is now aiming for a range of 175 to 185 million euros in 2023.
After its US stock market debut, the Vietnamese carmaker Vinfast is worth more than the much larger US companies General Motors and Ford. The price increase to a good $37 yesterday meant a market value of around $85 billion. Ford is currently worth almost $48 billion, General Motors a good $46 billion. However, only a relatively small number of Vinfast shares are traded, so there can be large price movements quickly. Vinfast had chosen a detour to the stock exchange: Instead of a classic IPO, Vinfast merged with an already listed company shell, a so-called SPAC.
The daughter of the internet giant Alphabet wants to train 20,000 women and young people in Nigeria and support the Nigerian government with 1.6 million dollars to create one million digital jobs in the African country. Meeting with Nigerian Vice President Kashim Shettima in Abuja on Tuesday, Google West Africa director Olumide Balogun said the company will provide funding to train women and youth in Nigeria for digital jobs and to encourage the growth of start-ups support financially.