Market concerns: weak US data also weighs on the Dax. Tech stocks in particular are under pressure in the US, while in Germany, in particular, shares of the Adler Group are tumbling.
With losses is the Dax started Monday in May. After the previous week, essentially stable, the main German index fell by 0.56% to 14,018 points in the first few minutes of Xetra trading.
The MDax of the midsize shares fell 0.42% to 29,967 points. The leading Eurozone EuroStoxx 50 index lost 1.3%. The share of the real estate company Adler Group fell particularly drastically after the opening of the stock exchange.
Weak US markets weigh
In the previous week, the Dax had already approached 13,500 points at times before recovering significantly with an increase back to well over 14,000 points. However, a full two percent loss remained for April.
Very weak US targets initially had a negative impact at the beginning of the week, where the major indices had plunged deep again before the weekend. “The fact that May of all time starts now, preceded by a bad reputation, certainly doesn’t help,” explained market expert Thomas Altmann of asset manager QC Partners.
On the Nasdaq technology exchange, the Nasdaq 100 selection index landed at its lowest level since March 2021 after the weakest month since 2008. On Monday morning, however, US futures recovered slightly.
The fear of interest rates puts the markets under pressure
Investors’ focus this week is on the key US Federal Reserve interest rate decision on Wednesday as the interest rate reversal continues. Following the recent clear signals from the Fed given the high level of inflation, the market expects a sharper increase in interest rates by 0.5 percentage points. Higher interest rates tend to weigh on the stock market.
Despite the high fluctuations for now, stronger companies should be able to deliver more consistent and stronger results, wrote Matthew Benkendorf, Investment strategist at Vontobel Quality Growth, referring to the current reporting season’s performance and forthcoming quarterly reports. High-margin quality companies could absorb rising costs and inflation, Benkendorf said.
Loss of billions to Adler
The shares of the Adler Group are under severe pressure on the German stock market. The real estate group had already announced on Friday evening that the KPMG auditor would not be able to issue an audit opinion for the consolidated and individual financial statements for 2021 after the end of the audit.
The annual data, which Adler nevertheless presented on Saturday and which revealed a loss of as much as one billion euros from depreciation, should probably only be of secondary importance to investors.
Since then, the stock has plummeted 45%. The Adler debacle is likely to weigh on the entire real estate sector as well, a trader said.