market report
The price fluctuations on the stock exchange will also be limited today. Before the central banks make important interest rate decisions in the coming days, investors are initially taking it easy in the morning.
According to pre-market signals, the DAX will start XETRA trading at around 16,165 points. That would correspond to a minus of 0.2 percent. Yesterday, the index gained 0.1 percent to 16,191 points after sluggish trading. The 16,000 point mark thus remains the linchpin of the market.
Quite different from the US stock exchanges for about two weeks: The hope for strong balance sheets of large technology groups pushed the US leading index Dow Jones up again by 0.5 percent to 35,411 points. The tech-heavy Nasdaq advanced 0.2 percent to 14,058 points and the broad-based S&P 500 gained 0.4 percent to 4,554 points.
Business figures from the software company Microsoft and Google’s mother Alphabet are due in the course of the day today. The streaming provider Spotify and the car company General Motors (GM) also present figures. On Wednesday, Facebook mother Meta opens her books.
Investors are also waiting for the US Federal Reserve’s interest rate decision tomorrow. The markets have braced themselves for a rate hike of a quarter of a percentage point. “We will know more on Wednesday evening as to how Fed Chairman Powell explains this and whether the July interest rate hike will be the last in this cycle,” said Juergen Molnar, strategist at broker RoboMarkets. The European Central Bank (ECB) is expected to raise interest rates again on Thursday.
The stock exchanges in Asia deliver different specifications in the morning. The announced support by the government in Beijing for the faltering economy after the corona pandemic gave investors in China a sigh of relief on Tuesday. The Shanghai stock exchange was up 1.8 percent. In contrast, investors in Japan are cautious in the run-up to interest rate decisions: the Nikkei index was 0.3 percent lower at 32,606 points.
On the forex market, the euro is now stable against the dollar after falling over the past few days. The European common currency was trading at $1.1068 in the morning, little changed.
Oil prices continued to trend higher. The North Sea variety Brent currently costs just under 83 euros per barrel. This put prices at their highest level in three months. According to experts, a number of factors contributed to the price gains. For example, the reduction in production by Saudi Arabia, the Russian export reduction and good economic data.
Two companies have come into focus on the German stock market by adjusting their business forecasts. Because of the weak business with crop protection products such as the weed killer glyphosate, Bayer slashed its annual targets in the evening. Accordingly, the group is making a write-down on its glyphosate business in the amount of 2.5 billion euros, which will lead to a loss of two billion euros in the second quarter. The news is not well received on the stock exchange. The share already fell in the evening trading and should start with losses today.
On the other hand, the sporting goods group Adidas is becoming more optimistic after the first sales of its inventory of products in the “Yeezy” series. Adidas once launched them together with scandal rapper Kanye West. The expected loss in 2023 should now be lower, the company announced last night. Adidas expects a negative operating result of 450 million euros for the year, after an initial estimate of 700 million euros.
The takeover of Software AG by the investor Silver Lake has consequences for the inclusion of the Darmstadt-based company in the index. The papers fall today from the MDAX and the TecDAX. The automotive supplier Vitesco, which has been promoted from the SDAX, is new to the index of medium-sized stocks. The football club Borussia Dortmund is returning to the SDAX for Vitesco. As a result of the takeover, Software AG’s free float had fallen below the ten percent threshold required for inclusion in the index.
Major Swiss bank UBS is paying more than $380 million in US and UK fines for recently acquired competitor Credit Suisse. It is mainly about misconduct in risk management in transactions with the collapsed hedge fund Archegos. In the US, UBS agreed to a $268.5 million fine, the US Federal Reserve announced. In the UK, the Prudential Regulation Authority imposed a record fine of £87million.