Dusseldorf The Dax undertook a new attack on the 15,600 mark on Monday. The German benchmark index increased by 0.2 percent to 15,562 points in the first hour of trading. The daily high is 15,581 points.
The Dax ended last week on Friday with an increase of 0.5 percent at 15,543 points, but lost 0.3 percent on a weekly basis. Nevertheless, the latest upward trend remained intact, as the leading index achieved both higher weekly highs than in the previous week (15,615 versus 15,599 points) and higher weekly lows (15,407 versus 15,012 points) – the classic definition of an upward movement.
If this trend continues, it now depends on whether the Dax sustainably exceeds the 15,600 mark. “If successful, the barriers define a first target at 15,800 points before the previous all-time high of 16,030 points comes back into focus”, explain the chart technicians at HSBC.
The reporting season, which is picking up speed this week, could act as a catalyst: investors and analysts expect a significant increase in earnings.
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In the USA, however, it has been shown that rising profits do not automatically mean rising prices. So far, less than 20 percent of companies have missed the forecast, according to Ulrich Stephan, chief investment strategist for private and corporate customers at Deutsche Bank.
The shares of companies whose profits exceeded the analysts’ estimates, however, closed the trading day only marginally better. Corporations that missed expectations, on the other hand, ended trading almost 4.5 percent lower. This shows that in an environment of high profit expectations, any disappointment can quickly lead to price losses.
On the economic side, investors are looking at business sentiment in Germany at the start of the week. The Munich Ifo Institute publishes its monthly business climate at ten o’clock. Experts expect a drop to 97.8 points from 98.8 points in the previous month for October. Most recently, the major disruptions in international trade in goods had caused great uncertainty.
Look at individual values
MTU Aero Engines: After a buy recommendation, the shares of the engine manufacturer in the Dax rise by 1.1 percent. The analysts at Stifel have raised the stocks to “Buy” from “Hold”.
Zooplus: The previously rival financial investor Hellman & Friedman and the Swedish investment company EQT now want to jointly take over the online pet supplies retailer Zooplus. It would be offered 480 euros per Zooplus share, announced Zooplus surprisingly on Monday. That corresponds to around 3.7 billion euros including debt. This is above the previous offer of 470 euros per share. On Friday the paper went out of trading at 475.40 euros. On Monday, the share rose 0.7 percent to EUR 478.60.
Atoss: The Munich-based provider of personnel management software has increased its sales. The revenues climbed from January to September by 14 percent to 69.5 million euros, such as Atoss Software announced. The operating result (EBIT) increased by almost seven percent to 18.6 million euros. The company also confirmed its outlook. Atoss shares drop 0.1 percent.
Turkish lira falls to new record low
The decline in the Turkish lira continues, in return the US dollar rises to 9.8545 lira per dollar and the euro to 11.3841 lira per euro – both record levels. After the unexpectedly sharp interest rate cut by the Turkish central bank on Thursday, Turkish President Recep Tayyip Erdogan’s verbal attack on the ambassadors of Germany, the USA and eight other western countries of the currency continued over the weekend. The background to this are demands for the release of the Turkish entrepreneur and culture promoter Osman Kavala.
The development is by no means just a political dispute, explains Commerzbank analyst Ulrich Leuchtmann: “Turkey depends on prosperous trade with the rest of the world. The country is isolating itself from the West too quickly, not only politically but also economically. “
The analysts at LBBW therefore fear that the current developments could lead to a further deterioration in the already very fragile economic situation in Turkey. According to Commerzbank expert Leuchtmann, Turkey could focus on trade with Russia and China in the long term, but such a restructuring of foreign trade relations would take years or decades and would involve adjustment costs. “At least during this time it would be questionable how Turkey could bring its balance of payments into equilibrium without the lira weakness.”
Leuchtmann also thinks it is possible that the foreign policy dispute is Erdogan’s diversionary maneuver. Because the trigger for the current weakness of the lira is its influence on monetary policy. This makes imported goods such as energy expensive, and loans in foreign currencies also become more expensive in real terms.
“If politicians create foreign images, it is easier to sell the burdens from the weak lira as a necessary price for political autonomy,” explains Leuchtmann. “But that also means that a monetary policy U-turn appears less likely.” As a result, the foreign exchange market could move the exchange rate paths closer to the collapse scenario without worrying about emergency interest rate hikes.
Oil prices rise to multi-year highs
Oil prices continued to rise at the beginning of the new week and reached multi-year highs. While the price of North Sea oil rose to its highest level in about three years, the US oil price hit a high in about seven years.
On Monday morning a barrel (159 liters) of the North Sea variety Brent cost 86.22 US dollars. That was 69 cents more than on Friday. The price of a barrel of the American West Texas Intermediate (WTI) rose 77 cents to $ 84.53. At the peak, both prices had risen a little higher.
The price drivers on the crude oil market have been the same for several weeks: While there is a high demand for energy worldwide, the supply is limited for various reasons. That drives up the prices of gas, coal and oil. The oil association Opec + is constantly expanding its production. However, according to experts, the increasing supply cannot keep pace with the high demand due to the economic situation.
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