Frankfurt The mood on the European stock exchanges clouded over again on Tuesday. Investors used the price gains from the start of the week for sales on Tuesday. In doing so, they followed the pattern of the recent past.
The leading German index lost 1.8 percent to 13,919 points by the end of trading. Only three stocks closed in the black. The MDax and the Eurozone leading index EuroStoxx 50 each fell by 1.6 percent.
The Dax was able to stay above the psychologically important mark of 14,000 points until the afternoon. After the weak start to trading on Wall Street, however, prices continued to fall.
One of the negative factors was the renewed gloomy corporate sentiment in the euro area. S&P Global’s Purchasing Managers’ Index fell slightly more sharply than analysts had expected on average. Overall, however, it remains at an acceptable level, explained the chief economist at Liechtenstein-based VP Bank, Thomas Gitzel.
Immediate risks of recession could not be derived from the economic barometer. The index values ”are clearly above the growth limit,” added Ulrich Wortberg from Landesbank Hessen-Thüringen (Helaba).
Euro rises to monthly high
The euro rose again on speculation that the European Central Bank (ECB) would take a more aggressive stance on monetary policy. On Monday, ECB boss Christine Lagarde promised an end to negative interest rates by the end of the third quarter and followed up on Bloomberg TV on Tuesday: The deposit rate could then be zero or “slightly higher”. She is currently not assuming that the euro zone will drift into recession.
Council member Martins Kazaks also intensified the debate about raising interest rates by 0.5 percentage points. A 50 basis point hike is “certainly something we could discuss,” said the head of the Latvian central bank. A step of this magnitude is “not part of the consensus” in the Governing Council, said French central bank chief Francois Villeroy de Galhau.
An increase of 50 basis points was publicly discussed by Klaas Knot for the first time last week. One could consider such a step, should the price pressure in the euro area intensify, said the Dutchman.
Certainly many observers would still consider the ECB to be too hesitant, said Commerzbank analyst You-Na Park-Heger. “Nonetheless, the fact that a July lift-off is now fairly certain and that the ECB is showing a willingness to raise interest rates even further afterwards is positive for the euro.” The common currency rose by as much as 0, 4 percent to a four-week high of $1.0735.
Given the signals, investors got back into financial stocks. The euro-zone bank index rose again after gains, hitting a one-month high of 90.11 points before dipping slightly.
The situation is different for high-growth online retailers: the prospect of rising interest rates is weighing them down the most, as their financing conditions are deteriorating. Zalando (minus 9.2), Hellofresh (minus 9.1) and Delivery Hero (minus 4.7) were the weakest Dax values.
Individual values in focus
Adler Group: The shares in the real estate group lost over 16 percent after a report by the Handelsblatt on investigations by the public prosecutor’s office against Adler.
DAY Property: The real estate group published figures for the first quarter. The Group continues to benefit from rising rents in metropolitan areas. Despite this, TAG was unable to convert the increase in earnings into price gains. Shares fell more than 14 percent. Analysts mainly focused on the group’s higher debt ratio.
About You: Shares in the online fashion retailer About You fell by more than 15 percent at times, the sharpest since the IPO about a year ago. Analyst Volker Bosse from Baader Helvea Bank complains that the sales growth targeted for the 2022/2023 financial year will fall short of market expectations at 25 to 35 percent. The titles ultimately closed 7.3 percent lower at EUR 8.33.
CTS Eventim: After making a profit at the start of the year, the ticket dealer and concert organizer is optimistic about a significant recovery from the corona pandemic, but does not dare to make a clear forecast for 2022 despite record ticket sales. The titles lost 3.6 percent.
Air France-KLM: A 2.3 billion euro capital increase sent Air France-KLM shares plummeting. The airline’s papers lost more than 20 percent in Paris. In their wake, the titles of Lufthansa and British Airways parent IAG give way.
Snapchat: A profit warning brings Snap a record price slide. Shares of the Snapchat operator fell more than 41 percent after the company said it would report below-market operating profit for the current quarter. Against this background, the papers of the advertising agencies WPP and Publicis also came under pressure, which fell by up to three percent. The same applied to shares in TV broadcasters such as ProSiebenSat.1, RTL and ITV.
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