market report
As of: 05/24/2022 6:19 p.m
The roller coaster ride on the stock exchanges continues: After a strong start to the week, the DAX fell back again today. Shares from the social media industry in particular experienced a black day.
The price recovery was short-lived. The DAX gave up almost all of its recent gains today. It fell by 1.8 percent and closed again below 14,000 points. “One day the market participants are euphoric and suppress the well-known stress factors. And a short time later the good mood suddenly vanished,” says market observer Christian Henke from Broker IG.
Snap’s profit warning overshadows markets
The mood spoiled the social media industry today. A profit warning from Snap weighed on global stock markets, particularly tech stocks. “Snap’s warning has sparked fears that ad spending has peaked for now,” said investment expert Russ Mold at wealth manager AJ Bell. The parent company of photo app Snapchat announced that it will miss second-quarter earnings and revenue guidance amid deteriorating macroeconomic trends. Snap’s shares plummeted 30 percent.
Wall Street plummets
The tech-heavy Nasdaq 100 fell more than 3 percent in the first two hours of trading, reversing yesterday’s gains. The Dow Jones also came under pressure. He lost 1.4 percent.
Concerns about interest rates and the economy are increasing again
The even harsher rhetoric from the US Federal Reserve, reports of clouded earnings prospects at large US retailers and weak economic indicators from China are exacerbating investors’ economic concerns, say the investment experts at BlackRock. In addition, the President of the European Central Bank (ECB) signaled an imminent turnaround in interest rates.
Update economy from 05/24/2022
Stefan Wolff, HR, tagesschau24, May 24, 2022
Lagarde supports euro
On the other hand, the euro went up, breaking through the $1.07 mark. Yesterday, ECB President Christine Lagarde promised an end to negative interest rates in late summer. The reason for the tightening is the high inflation, to which the ECB has to react. Investors appear to be preparing for more aggressive monetary policy.
Today Lagarde commented on the economy in the euro zone. The head of the central bank is not assuming a recession: An economic downturn is currently not the central bank’s basic scenario, according to Lagarde – the way for interest rate hikes would be clear as things stand at the moment.
However, a rising euro makes goods from Germany more expensive for countries outside the euro zone. This in turn could put a strain on many export-oriented companies.
Ray of light for the German economy
In addition, there is positive news from the economic side in Germany: The German export industry is expecting slightly better business again. The index of the Munich ifo Institute for export expectations rose to 4.5 points in May after 3.0 points in April. In addition, the purchasing managers’ index for the private sector, industry and service sector together surprisingly increased by 0.3 to 54.6 points in May, as S&P Global announced in its monthly survey of around 800 companies. Experts had expected a decline.
Investigations by the public prosecutor’s office against Adler?
Papers from the Adler Group are falling sharply today. The public prosecutor’s office in Frankfurt has now started investigations, reports the “Handelsblatt”, citing informed persons. The Federal Financial Supervisory Authority (BaFin) is currently examining Adler’s books. The agency intervened after the real estate company first came under fire from short seller Fraser Perring in October.
This and his research service Viceroy had raised serious allegations against Adler, among other things, it was about the valuation of real estate projects. The company had denied the allegations. In the meantime, Adler also has to look for new auditors after KPMG is not available for the 2022 annual and consolidated financial statements.
Billions invested by Samsung
South Korean electronics group Samsung plans to invest 450 trillion won (334 billion euros) over the next five years to fuel the growth of its semiconductor and biopharmaceutical businesses. The investments are 30 percent higher than in the five years to 2021, as Samsung announced. Securing domestic chip and bio supply chains is of strategic importance and important for South Korea’s economic security, Samsung said.
Higher rents continue to drive TAG Immobilien
TAG Immobilien continues to benefit from rising rents in urban areas. In the first quarter, the operating result (FFO 1) increased by almost five percent year-on-year to EUR 47.8 million. Rents without taxes climbed 1.4 percent to EUR 84.3 million. Due to transaction costs in connection with the purchase of the Polish residential real estate developer Robyg, the consolidated result fell by a good six percent to 32.3 million euros.
CTS Eventim: Ticket sales at a record high
Thanks to the end of the corona restrictions, the concert organizer and ticket seller grew strongly in the first quarter. Sales soared to around 140 million euros after almost 20 million a year ago and the normalized operating result (Ebitda) reached 23.7 million euros after a minus of almost 20 million. “Concert halls and festival grounds are finally coming to life again. The strong start to the year gives us every reason to be confident that we will experience a powerful restart of the live business this year,” said company boss Klaus-Peter Schulenberg. In April and May, ticket sales were well above the record values of the pre-crisis year 2019.
Airbnb is largely ceasing business in China
The vacation rental platform Airbnb is largely ceasing its business in China. The company will no longer offer accommodation or “experiences” to visitors in China, AFP news agency reports. However, users from China should still be able to book accommodation abroad. The company declined to comment officially.
The platform is struggling with strong competition in China. In recent years, the Chinese government’s strict isolation measures during the corona pandemic have also made business more difficult.
Zoom Video is growing as slowly as it did when it went public
The US video service Zoom grew more slowly in the first quarter than it did when it went public in 2019. Sales rose by twelve percent to $ 1.07 billion. For some time now, strong competition from Cisco’s WebEx, Salesforce’s Slack and Microsoft Teams, and Google Meet have slowed Zoom’s growth. Like its competitors, the company is benefiting from the trend towards flexible working between home office and office, but not as much as at the beginning of the corona pandemic.
Electronic Arts before takeover?
The video game maker Electronic Arts could be about to be taken over. The US website “Puck News” said that there had been exploratory talks with large media groups. Disney, Apple and Amazon are said to have been among the potential buyers. Comcast CEO Brian Roberts approached Electronic Arts and proposed a spin-off from NBCUniversal followed by a merger of the media and gaming giants.