Status: 07.06.2022 12:55 p.m
Investors are reaping gains ahead of Thursday’s ECB interest rate meeting. Uncertainty about the future monetary policy of the European Central Bank is dampening risk appetite.
The DAX lost around one percent to around 14,500 points. The leading German index closed yesterday with a plus of 1.3 percent to 14,653.81 points with thin sales. Investors are not letting go of the persistent interest rate concerns in the eurozone.
“Volatility will remain high”
“Investors are cautious about Thursday’s forthcoming ECB meeting,” comments IG’s Salah-Eddine Bouhmidi. “Rising oil prices, scarcity of raw materials and the wage-price spiral point to further galloping inflation and a reaction from the central bankers,” said the expert. Bouhmidi is convinced that there is no way around a more aggressive, restrictive monetary policy on either side of the Atlantic: “Market participants know that and have realized their profits bit by bit since the beginning of the year.”
Sven Lehmann, capital market analyst at HQ Trust, still expects high fluctuations on the stock exchanges: “Volatility will remain high in the short term. At least as long as the current uncertainties, the Ukraine war, energy prices and China’s lockdown measures, remain in place.”
Mixed economic data
Headwind is also coming from fresh data from German industry. In April, she surprisingly landed fewer orders for the third month in a row. “The increased uncertainty caused by the Russian invasion of Ukraine continues to lead to weak demand, especially from abroad,” said the Federal Ministry of Economics.
On the other hand, the results of the Sentix survey on the mood in the economy in the euro zone received little attention on the market. The economic confidence of the financial market professionals increased in June for the first time after three declines in a row. Sentix managing director Manfred Hübner sees this as a “sign of stabilization”.
Update economy from 07.06.2022
Anne-Catherine Beck, HR, 06/07/2022 09:49 am
Erdogan wants to lower interest rates further
Turkish President Recep Tayyip Erdogan announces further interest rate cuts by the central bank despite inflation exceeding 70 percent. “This government will not raise interest rates. On the contrary, we will keep lowering them,” Erdogan said. The Turkish lira then fell temporarily by 0.2 percent to $16.60, its lowest level since December.
SGL Carbon increases outlook
SGL Carbon is more confident about the year as a whole and is raising its sales and earnings outlook. Business is developing well and the increased costs for raw materials, energy and logistics can be passed on to customers, according to the reasoning. Sales of around 1.1 billion euros are now being targeted for 2022 and thus above the previous year’s level (2021: almost 1.01 billion euros). In terms of operating profit (Ebitda), SGL is aiming for a figure of between 130 and 150 million euros instead of the previous 110 to 130 million euros.
JPMorgan hires bankers from UBS and Credit Suisse
The major US bank JP Morgan is expanding its business with external asset managers in Switzerland. JP Morgan hired David Cataldi and Pierre-Olivier Tisseuil as advisors to rich families (Multi Family Offices). Cataldi comes from UBS, Tisseuil from Credit Suisse. The two reported to Matteo Gianini. The head of private banking in Switzerland is now also responsible for business with external asset managers in the country. JP Morgan wants to become the leading foreign advisor to external asset managers in Switzerland.
“Green steel”: Salzgitter and Rio Tinto cooperate
The Salzgitter steel group, together with the Rio Tinto mining group, wants to press ahead with its plans for more climate-friendly steel production. The companies said it was about low-CO2 supply chains and production processes. An agreement in principle has been concluded for this purpose. The focus is on the future supply of high-quality iron ore products. Salzgitter and Rio Tinto also wanted to take a close look at the CO2 emissions in the entire supply chain. With its Salcos program, Salzgitter intends to gradually have almost CO2-free steel production by 2033.
Peloton hires new chief financial officer from Amazon
The new CFO of struggling fitness equipment provider Peloton Interactive comes from Amazon. Liz Coddington takes the position, Peloton said. Up to $2,500 stationary bikes and treadmills aren’t selling as well, so warehouses are full. At the height of the Corona crisis, Peloton was still valued at around 50 billion dollars on the market and, after a downward slide, has now reached around a tenth.
Meta appoints information security chief
Facebook owner Meta Platforms has appointed Guy Rosen to the position of head of information security for the first time in the company’s history. Rosen tweeted that he would monitor the full range of security risks for users, the company and the industry. Rosen has been working for the world’s largest internet network with almost three billion monthly users since 2013. Company founder Mark Zuckerberg described the appointment in an internal letter seen by Reuters as a further step to emphasize the security aspect.
Glencore replaces Adidas in the Stoxx Europe 50
After the significant price losses of the past few months, the sporting goods manufacturer Adidas flies out of the Stoxx Europe 50. Its place will be taken by the raw materials and mining group Glencore on June 20, as the index provider announced. Driven by booming commodity prices, Glencore shares have already risen by almost 45 percent in the current year. For Adidas, on the other hand, it has been down by more than a quarter so far.
Apple enters the installment market
The US technology group Apple wants to offer US customers the purchase with installment payments from autumn. Users of the Apple Pay payment service should be able to pay for a purchase in four installments over six weeks “without interest or fees of any kind,” the company said. Apple wants to work with the payment service provider Mastercard. Numerous providers such as Affirm, Afterpay, Klarna and PayPal are already bustling about in the market for installment payments. Their sales have skyrocketed during the pandemic.
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