market report
The impending escalation of the situation in the Middle East has the raw materials and financial markets firmly in its grip. While gold and oil prices rise, stock prices fall.
The Middle East war has now caught up with the stock market again. While it looked for a few days as if the stock market could somewhat decouple itself from the conflict between Israel and the terrorist organization Hamas, the recent escalation with the rocket hitting a hospital in the Gaza Strip has brought the conflict back into the focus of the markets. This can be seen above all in the raw material markets: the “safe haven” gold is in demand and oil prices are rising.
The DAX is currently trading at its daily low with a discount of just under one percent. The leading index was just below Monday’s low of 15,103 points. Meanwhile, support for the stock market barometer comes from strong price gains in Adidas shares following an increase in annual targets.
The approaching small expiry day on Friday tends to support a sideways movement in the DAX. According to ING expert Christian Zoller, a settlement in the DAX future on Friday is likely in the range of 15,250/15,300 points. After the expiry date, things could go downhill in the coming week.
The US markets started with discounts. Half an hour after the start of trading, the Dow Jones lost 0.3 percent.
The Nasdaq 100 technology index fell slightly more significantly at 0.5 percent.
Meanwhile, the impending escalation of the situation in the Middle East is driving the price of gold further towards the $2,000 mark. In the middle of the week, the troy ounce of gold was trading at a peak of $1,958 – around $33 more and the highest level in four weeks. The yellow precious metal is continuing its strong rise since the attack on Israel by the militant Islamist Hamas.
Since October 6th, the precious metal has increased in price by more than $100 per troy ounce. If the conflict spreads to other countries, the price of gold is likely to continue to rise due to its role as a “safe haven,” predicted raw materials expert Thu Lan Nguyen from Commerzbank.
Prices on the oil market have risen due to the escalating situation in the Middle East. Better-than-expected economic data from China also supported prices, encouraging speculation about higher demand.
In the early afternoon, a barrel (159 liters) of North Sea Brent for delivery in December cost $91.14.
An additional risk factor for the stock markets that continues to simmer in the background is the trade war between the USA and China. The US has announced tighter restrictions on exports of cutting-edge semiconductors to China. According to US Commerce Secretary Gina Raimondo, the measures are particularly aimed at China’s capacity to develop AI technology.
So far, the US chip manufacturer Nvidia and its high-performance chip H100 have been at the center of US export bans. The update of the export rules now also includes an export ban for other, less powerful semiconductors from Nvidia and other manufacturers.
Things are likely to go downhill on Wall Street in the middle of the week. The future on the standard values in the US leading index Dow Jones Industrial Average is currently losing 0.4 percent. The future on the technology-heavy Nasdaq 100 is 0.6 percent lower.
In the DAX, Adidas shares were the biggest winners in the early afternoon. After the second successful sale of “Yeezy” shoes, the sporting goods manufacturer only expects a small loss this year. The operating loss will only be around 100 million euros, 350 million less than predicted in the summer, Adidas announced yesterday evening. In the wake of Adidas, Puma shares also posted strong price gains in the MDAX.
Continental shares have extended their recent price recovery. Apparently the sale of autonomous mobility areas is being put to the test at the tire company and auto supplier. The Bloomberg news agency reported this the evening before, citing well-informed circles. Actually, this is not new, said a stock exchange investor. But the plans remained interesting.
Daimler Truck shares also occupy a top spot in the DAX, and Traton is in high demand in the SDAX. The two commercial vehicle manufacturers are benefiting from a surprisingly high quarterly profit from the Swedish truck and bus manufacturer Volvo.
Lufthansa shares are under pressure in the MDAX. The US bank Citigroup has downgraded the shares from “Buy” to “Neutral” and lowered the price target from 14 to 7.90 euros. Analyst Sathish Sivakumar justifies this in his industry study with increasing risks for the Frankfurt-based company’s margin target for the 2024 financial year. Higher kerosene costs and problems with GTF engines slowed down the cost reduction potential. He also sees earnings risks in the freight sector.
The automotive supplier Hella, which is also listed in the MDAX, significantly expanded its business in the first nine months. Compared to the same period last year, sales climbed by 13 percent to 5.9 billion euros, as the group, which belongs to the French automotive supplier Faurecia, announced. Hella is growing in all areas and in all regions, said company boss Michel Favre.
Due to the economic weakness in the chemical industry, the specialty chemicals group Lanxess is cutting around one in 15 of its jobs worldwide. In order to become more efficient, costs should be reduced by 150 million euros per year, as a company spokesman said on Tuesday evening. The measures include the reduction of 870 full-time positions, 460 of which are in Germany.
After a slump in business last year, the online broker FlatexDegiro made significant gains again in the summer. Thanks to increased interest rates and higher commissions per transaction, adjusted earnings before interest, taxes, depreciation and amortization (adjusted Ebitda) jumped by 70 percent to around 41 million euros.
The chip supplier ASML fully felt the weakness of the industry when it came to orders in the third quarter. The EuroStoxx 50 heavyweight announced today that the value of new orders fell by 42 percent to 2.6 billion euros compared to the previous quarter. Sales fell by just over three percent to just under 6.7 billion euros.
BYD shares took off on the Hong Kong stock exchange. She won over six percent. The electric car maker announced yesterday that it expects profits to rise in the third quarter due to robust sales and effective cost controls. Net profit could grow to 11.55 billion yuan (around 1.5 billion euros), doubling compared to the same period last year.
After two accidents involving pedestrians in San Francisco, the robotaxi company Cruise came into the attention of the US transport authority. The NHTSA initiated a preliminary investigation that, among other things, should clarify whether the General Motors subsidiary’s vehicles, some of which are completely driverless, drive too close to people.
Microsoft boss Satya Nadella has expressed confidence that software with artificial intelligence will remain a tool under human control in the future. There are still many intermediate steps on the way to programs that can improve themselves, emphasized Nadella in the evening at the Axel Springer Awards ceremony in Berlin. “And we as humans are good at using very powerful technology with a lot of rules, regulation and security standards.”
The US airline United Airlines has caused disappointment on the stock market with its profit forecast for the current quarter. If flights to Tel Aviv are only suspended until the end of October, United expects earnings per share of $1.80 for the current quarter. If it were to stop by the end of the year, it would only be $1.50, as the airline predicted.
The US online retailer Amazon says it is already using 10,000 electric delivery vans from the manufacturer Rivian to deliver its goods in the USA and Europe. Amazon has already made 150 million deliveries using Rivian vans, the company said. By 2030, there should be at least 100,000 electric delivery vans on the roads. Amazon has a stake in the electric car manufacturer.