DAX turns up: Hardly any pressure to sell

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Status: 08.03.2023 6:08 p.m

Thanks to positive company data, the DAX successfully defied the new interest rate concerns from the USA. Wall Street, on the other hand, shows little enthusiasm.

The German market held up quite well today given renewed interest rate concerns in the United States. After a poor start, the DAX made it back up around noon and closed 0.46 percent higher. Yesterday, the leading German index initially climbed to a new high for the year at 15,706 points. before turning negative in the wake of weak US stock markets.

Wall Street powerless

Wall Street opened little changed after yesterday’s bitter losses. An hour and a half after the start of trading, the Dow Jones lost 0.1 percent. Yesterday, the US leading index reacted with a minus of 1.7 percent to statements by US Federal Reserve Chairman Jerome Powell on interest rate policy.

Recent strong economic data suggested that the final level for the federal funds rate is likely to be higher than previously expected, Powell said. Today, the service provider ADP reported higher-than-expected job growth in the private sector for February. The labor market is an important factor influencing US monetary policy, as high wage increases bring additional inflation potential.

Longer phase of high interest rates?

According to the experts at Credit Suisse, a longer period of higher interest rates is once again becoming apparent on the financial markets. The resulting negative impact on the stock markets is too great to be ignored, commented portfolio manager Thomas Altmann from QC Partners. As a result, the financing costs for companies continued to rise and profits fell.

Euro without enthusiasm

In view of the prospect of significant interest rate hikes in the USA, the European common currency cannot maintain its interim gains. With courses around 1.0550 dollars, the euro is hardly changed in the market.

Oil prices continue to fall

Oil prices are still under pressure after yesterday’s significant price losses. In the late afternoon, a barrel (159 liters) of North Sea Brent for delivery in May is priced at $82.70. The reason for this is the new speculation about stronger interest rate hikes in the USA. The fact that oil reserves in the USA have surprisingly fallen for the first time in almost three months has hardly supported prices so far. Last week, inventories of crude oil fell 1.7 million barrels to 478.5 million barrels compared to the previous week. Previously, weekly oil reserve data had risen steadily since mid-December.

US regulators are investigating Tesla Model Y

The Tesla share has a difficult time in US trading. The US electric car maker has been targeted by the NHTSA after complaints about missing steering wheel mounts. The US agency launched a preliminary investigation following two reports of steering wheels falling off while driving. According to NHTSA, the vehicles were delivered without mounting bolts. The determination includes a good 120,000 Tesla Model Y from the year 2023. The next step could be to order a recall. In addition, analyst Adrian Yanoshik from the private bank Berenberg downgraded Tesla shares to “Hold”. The focus on smaller electric vehicles should expand the market potential significantly, but it will take time, he argued.

Conti DAX leader

With growth of more than seven percent, Continental shares were the only ones at the top of the DAX. The automotive supplier has surprisingly increased its operating result despite massive cost increases. With sales growing by almost 17 percent to EUR 39.4 billion, adjusted earnings before interest and taxes (EBIT) climbed by a good five percent to EUR 2.0 billion. However, Continental wants to reduce the dividend by 70 cents to EUR 1.50 per share.

Adidas in demand despite the poor outlook

Adidas stock put on a remarkable intraday rally. After significant losses, the DAX title turned positive over the course of the year. After a slump in profits last year, the prospects for the sporting goods manufacturer remain poor for the time being. The new CEO Björn Gulden announced a “transition year” for 2023. After the profit slump last year, Adidas investors have to look forward to a significantly lower dividend of EUR 0.70 per share set, after 3.30 euros in the previous year.

Symrise under suspicion of a cartel?

The fragrance and flavor manufacturer Symrise sees itself from Suspicion of possible price fixing for fragrances not affected. “We are currently involved in the proceedings as a witness,” said CEO Heinz-Jürgen Bertram today at the presentation of the annual balance sheet. Symrise does not know any further details either. Yesterday, the EU antitrust authorities investigated companies and an association in the fragrance industry in several member states. According to the Swiss Competition Commission, the Swiss industry giants Firmenich and Givaudan as well as International Flavors & Fragrances from the USA and Symrise are at the center of international investigations.

Brenntag with a cautious outlook

Brenntag expects the difficult business environment to continue in the current year. For the current year, the chemicals trader is therefore assuming, in the best case, an operating result at the previous year’s level and is aiming for adjusted earnings before interest, taxes, depreciation and amortization (Ebitda) of 1.6 to 1.8 billion euros. In 2022, sales climbed by 35 percent to 19.4 billion euros. Ebitda, adjusted for special effects, rose by a good third to 1.8 billion euros.

Fuchs share under pressure

One of the weakest shares in the MDAX was Fuchs Petrolub. The lubricant manufacturer felt the effects of rising raw material costs last year. At EUR 365 million, the operating result (EBIT) exceeded the previous year’s figure by just under EUR 2 million. Sales increased by 19 percent to 3.4 billion euros. Because of the economic imponderables, the Management Board remained cautious with its forecast and announced an increase in sales in the mid-single-digit percentage range to EUR 3.6 billion.

BVB-Akie loses after knockout round

After the knockout round of the Champions League, the Borussia Dortmund share was under a lot of pressure. The BVB paper lost more than eight percent and fell to its lowest level in seven weeks. The day before, investors were still optimistic about the game against Chelsea, with the highest prices in over a year. Now there was not only the sporting disappointment, the club also missed out on further UEFA money.



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