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Market report: DAX fate depends on the ECB

Market report: DAX fate depends on the ECB
Written by insideindyhomes


market report

Status: 06.06.2022 12:25 p.m

The DAX has broken the mark of 14,600 points. How sustainable this breakout to the upside is will only become clear over the course of the week when the ECB decides on its future monetary policy.

The DAX continued to expand its early gains during the morning. In thin holiday trading on Whit Monday, the German stock exchange barometer passed the important 14,600 point mark and reached 14,618 points, the highest level since the end of March.

At the beginning of the week, the main driver was the easing of corona restrictions in the Chinese metropolis of Beijing. Also mentioned were improved economic data from China. There, the mood in the service sector brightened a little in May.

DAX investors are eagerly awaiting the ECB

Whether the DAX, after several failed attempts, will be able to establish itself above the 14,600 mark in the course of the week also depends on the European Central Bank (ECB). The monetary watchdogs of the euro zone will meet on Thursday to discuss future monetary policy under the leadership of ECB boss Christine Lagarde.

According to economists, the ECB is likely to announce the end of its net bond purchases this week. This would lay the foundation for the first interest rate hike since 2011, which is likely to be announced at the subsequent ECB meeting on July 21st. The Dekabank experts are expecting interest rate increases of 0.25 percentage points at the next meetings.

London stock exchange hopes for Johnson-Aus

After the long weekend in Great Britain on the occasion of the 70th anniversary of Queen Elizabeth II’s throne and only a few hours before the motion of no confidence in Prime Minister Boris Johnson, the London selection index FTSE recorded significant price gains. The British pound is also on the up. The British currency is currently gaining 0.4 percent against the euro and even 0.6 percent against the dollar.

“The market wants to see Johnson lose,” said Stuart Cole, chief economist at brokerage firm Equiti Capital. Because under new leadership, the government can concentrate on important issues such as inflation.

Wall Street ahead of significant price gains

Wall Street is also likely to be on the up again today after the most recent setback. The future on the US leading index Dow Jones Industrial Average is currently gaining 0.8 percent.

The future on the Nasdaq 100 selection index, which is predominantly stocked with technology stocks, even rose by 1.4 percent. At the end of the week, fears of interest rates fueled by a strong job market report drove the US stock exchanges into the red.

Brent oil price jumps high

Oil prices jumped at the start of the week after Saudi Arabia raised the price of its crude oil sales sharply in July. A barrel (159 liters) of the North Sea Brent cost $120.66 at lunchtime, 0.8 percent more than on Friday, after it had meanwhile gone up to almost $122.

Investors are betting that increases in supply planned by OPEC will not be enough to meet demand. Especially since China is relaxing its corona restrictions.

Euro and gold slightly on the rise

The dollar remains slightly under pressure in forex trading. In return, the euro rose by 0.2 percent to $ 1.0741. Gold prices continue to consolidate. Currently, 1852 dollars are paid for an ounce of the yellow precious metal.

Beiersdorf back in the DAX, Delivery Hero descends

A little over a year after being dropped from the DAX, Beiersdorf is celebrating a comeback in the first German stock exchange league. The “Nivea” manufacturer will replace Delivery Hero, Deutsche Börse announced on Friday evening. The food supplier, which has been making losses for years and whose entry into the DAX was therefore once criticized by many, is relegated to the MDAX small-cap index.

Encavis in the future in the MDAX

In addition, the green electricity provider Encavis replaces the financial service provider Hypoport in the MDax. In addition to Hypoport, the armaments company Hensoldt will also be represented in the SDAX again in the future, as will the wind farm project developer PNE. The laser expert LPKF and the carbon fiber specialist SGL have to be eliminated. Deutsche Börse will implement the changes on June 20th.

Nemetschek stock is a “top pick” for Citigroup

In the MDAX, the Nemetschek share is in demand for a buy recommendation from the US bank Citigroup. Their analyst Pavan Daswani took on the rating of the papers with “buy” and a price target of 85 euros. He justified his positive assessment with the leading growth of the construction software provider in the European digital sector – and named the share the “top pick” in this industry.

SMA-Solar in demand in the SDAX

A report by the “Wall Street Journal”, according to which the US government is considering lifting some tariffs on Chinese products in the fight against high inflation, is also giving German solar stocks tailwind. In the SDAX, shares in the manufacturer of inverters for solar modules, SMA Solar, are among the most sought-after values ​​with a plus of more than two percent.

Mercedes is recalling almost a million cars worldwide

According to the Federal Motor Transport Authority, Mercedes-Benz is recalling almost a million older vehicles worldwide because of possible brake problems. Accordingly, ML, GL and R-Class cars built between 2004 and 2015 are affected, as the authority announced in its recall database. Germany probably accounts for almost 70,000 cars.

Is O2 lagging behind in mobile network expansion?

When it comes to expanding mobile communications, the network operator Telefónica (O2) is obviously not as far along as its competitors. According to an internal paper that the Federal Network Agency sent to the Digital Committee of the Bundestag and that is available to the dpa news agency, Vodafone is the furthest along. The British provider’s antennas reached 98.3 percent of German households in April. Deutsche Telekom came to 98.2 percent and Telefónica to 95.1 percent.

Will the ban on new users for Didi be lifted?

Chinese supervisors could complete scrutiny of ridesharing service Didi and end ban on adding new users. This is reported by the “Wall Street Journal”, citing people familiar with the matter. The Didi papers listed on the US stock exchange rose by around 50 percent before the market.

KLM brings stranded passengers to Amsterdam

On Pentecost Sunday, the Dutch airline KLM began bringing many of its passengers stranded in European countries the day before to Amsterdam. At the same time, hard work is being done to rebook passengers who actually wanted to continue flying from Schiphol Airport on Saturday and missed their connections, said a KLM spokesman for the ANP news agency.

Novartis targeted by hackers

The Swiss pharmaceutical company Novartis has been targeted by hackers. At the request of the Keystone-SDA news agency, Novartis confirmed a corresponding report in the French-speaking Swiss daily “Le Temps” on Sunday, which was based on the specialized website BleepingComputer. The case has been thoroughly investigated and theft of sensitive data can be ruled out.

German ex-boss of OMV not relieved

At the annual general meeting, the shareholders of the Austrian oil and gas group OMV gave a negative verdict on ex-boss Rainer Seele and his Russia strategy. The majority of the owners, including the state holding ÖBAG, refused to discharge the German manager as CEO for the previous year. Seele left the company in mid-2021.

Apple’s developer conference WWDC begins

Apple will give an outlook on the future functions of its devices from 7:00 p.m. today. At the start of its WWDC developer conference, the group traditionally presents innovations in its operating systems for iPhone, iPad, Mac computers and the Apple Watch computer watch, which will be available in autumn. According to media reports, this time it is expected, among other things, that the simultaneous use of several apps will be made easier on the iPad tablets.

Hydrogen specialist De Nora drives IPO

According to insiders, the Italian hydrogen specialist and Thyssenkrupp partner Industrie De Nora wants to announce its stock market plans in the new week. The company, which supplies plant components for hydrogen production, is aiming for its initial listing on the Milan Stock Exchange in June, three people familiar with the plans told Reuters on Sunday.

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