Failed price recovery: DAX drops to a new three-month low

market report

Status: 06/24/2022 09:54

The bulls in the DAX failed miserably in an attempt to recover after yesterday’s price drop. The barometer of the German stock market has been hitting a new low for three months and is thus sending a new sell signal.

The DAX started slowly on the last trading day of the week. Missing is the large counter-reaction to yesterday’s price losses, which was still evident in pre-market trading this morning. At the start of trading on XETRA, German standard values ​​rose 0.3 percent to 12,946 points.

The DAX dips below yesterday’s low

But even these slight price increases are quickly consumed. In the first half hour of trading, the DAX continues to slide. Even yesterday’s daily low of 12,913 points cannot stop the bears (sellers).

The DAX marks a new three-month low at 12,905 points. In the further course of trading, the publication of the ifo index could provide a new boost to prices. Experts expect a slight drop to 92.9 points from 93.0 points in June.

The R word teaches investors to fear

The announcement of the alarm level for the gas emergency plan by the Federal Minister of Economy Habeck yesterday accelerated the sell-off on the German stock market. It dropped to 12,913 points.

After a failed stabilization attempt earlier in the week, the DAX had already been under pressure in the previous days; the R word alienated investors. Investors fear that central banks, which have long hesitated to identify inflation as an ongoing problem, may now trigger a recession by tightening monetary policy too quickly.

Focus on major DAX brands

By marking a new three-month low, the DAX sends out a new technical sell signal. Investors must now be prepared for an upcoming test of the March low at 12,439 points.

“To remove the increased pressure from the DAX, it is at least necessary to regain the previous low of 13,008 points from last Thursday or, even better, close the most recent price gap to the downside at 13,206 / 13,273 points”, points out the technical analysts of HSBC in a current analysis.

Good directions from Wall Street

German stock market investors initially ignore Wall Street’s good indications. US stock exchanges closed yesterday with price gains after volatile trading. Tech and defensive stocks in particular were in demand.

The US Dow Jones Standard Value Index rose 0.6% to 30,677 points from trading. The high-tech Nasdaq advanced 1.6% to 11,232 points. The broad S&P 500 gained around 1% to 3795 points.

Powell aims for a “soft landing”.

Federal Reserve Chairman Jerome Powell pledged to fight inflation in his biannual hearing before the United States Congress. His house is trying to cautiously cool the US economy. However, it will be more difficult to achieve this.

Many economists and investors fear that the rapid tightening of US monetary policy could plunge the world’s largest economy into recession, with fatal consequences for the global economy and corporate profits.

Nikkei closes with significant gains

The Wall Street recovery has encouraged investors in Asian equity markets to buy stocks. The Japanese Nikkei index rose 1.2% to 26,492 points and the Shanghai Stock Exchange by 0.9% to 3,349 points. In China, a cash injection of € 8.5 billion from the local central bank also cheered the mood.

Euro and gold with slight gains

The dollar is slightly weaker at the start of forex trading. At the same time, the euro rose 0.2% to $ 1.0542. The European common currency is once again trading well above the $ 1.05 threshold, below which it slipped yesterday in trading.

The slightly weaker dollar benefits dollar-denominated commodities. An ounce of gold costs $ 1,826, up 0.1% from the previous day.

Quote Zalando with collapsing prices

Online fashion retailer Zalando fears a prolonged decline in demand due to the recent clouded economic outlook. The firm, which is listed on the DAX, therefore cut its annual targets last night and expects at most a small increase in sales in 2022. The shares are down about 15% in the first few trades.

Deutsche Bank: US subsidiaries’ scores in the Fed’s stress test

The good result of the US subsidiary in the Fed stress test encourages investors to invest in Deutsche Bank. Shares of the Money House are up 2.8% before the market. Deutsche Bank’s US division, which had gone bankrupt several times in recent years, had the highest capital ratio at 22.8%.

Management forgoes a small portion of its bonus

According to the circles, Deutsche Bank’s ten-member board of directors has agreed to forgo a small portion of its bonuses; they are about 75,000 euros each. The bank had had problems with the regulator due to the widespread use of private communication channels such as WhatsApp for corporate communication between employees.

The chip shortage will also affect Airbus

The Airbus DAX Group predicts a longer chip shortage. The topic will accompany the industry for another two years, Mike Schöllhorn, head of the armaments division, told Reuters. The aviation industry suffers later than the automotive industry, and the military later due to small quantities, “but at some point it will affect us too.”

IPO: Despite worries about the economy, Porsche goes public

Despite difficult economic conditions, Porsche’s Executive Board sees no reason to cancel the planned IPO. Preparations were in full swing, said CEO Oliver Blume of the “Frankfurter Allgemeine Zeitung”. Concerns about the economy, the stock market environment and the war in Ukraine would also not deter Porsche from the project.

Lufthansa will cancel another 2,200 flights during the holiday season

In the midst of the summer holiday period, Lufthansa will cancel over 2,000 more flights at its Frankfurt and Munich hubs due to a lack of staff. Two good weeks ago, it announced it would be canceling 900 connections on Fridays and July weekends.

Squeeze from Adler Real Estate

The Adler Group real estate group wants to fully take over its German subsidiary Adler Real Estate and squeeze the other shareholders. The Luxembourg parent company, which holds a 96.7% stake in Adler Real Estate, has requested a squeeze-out procedure in which all other shareholders are forcibly compensated, both companies announced. Financial regulator BaFin had previously extended its audit of Adler Real Estate’s financial statements to 2021.

FedEx competitor post with increased sales

US logistics group FedEx achieved significantly higher sales in the last fiscal quarter. Revenue rose 8% year-on-year to $ 24.4 billion, Post competitor announced yesterday following the close of the US stock market. This has gone well with investors; the stock rose in after-hour trading.

Nike is completely turning its back on Russia

The world’s largest sporting goods company Nike wants to withdraw completely from Russia in the run-up to the ongoing war against Ukraine. “Nike has made the decision to exit the Russian market,” a spokesperson said. The priority now is to support local workers as operations will be shut down responsibly in the coming months.

Amazon shows the software for quick voice imitation

Amazon has developed software that can mimic a human’s voice in less than a minute of speech. The online company yesterday showed how a networked speaker with language assistant Alexa reads the book “The Wizard of Oz” to a boy with his grandmother’s voice.

Instagram is experimenting with automatic age detection

Instagram is testing automatic age detection based on a selfie video in the United States. Users are prompted to upload a clip. A software company from partner Yoti will then estimate the age, as the photo and video platform of the Facebook Meta group explained yesterday.

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