Frankfurt Affected by a price collapse at Adidas, the mood on the German stock market clouded over at the end of the week. At the close of trading, the Dax was at 15,308 points, a loss of 1.4 percent.
Adidas shares fell by 11.5 percent and posted their blackest trading day since the corona pandemic began in March 2020. The abrupt separation from the American scandal rapper Kanye West is likely to push the sporting goods group into the red in the current year. “A terrible prospect – far below all expectations,” commented the experts from Baader Helvea.
The weak specifications of Wall Street spoiled the mood of investors in this country. “The big unknown is and remains the interest rate of the Fed, which continues to cause deep concern among investors and thus unsteady and volatile price developments,” summarized the strategists at Raiffeisen Research.
The US stock exchanges opened on Friday with slight price losses. A rise in US 10-year Treasury yields hurt tech stocks like Amazon, Apple, and Tesla. These fell between 0.9 and 2.8 percent.
According to experts, higher interest rates will devalue the future profits of these high-growth companies. In addition, shares in ride-hailing service provider Lyft lost around a third of their value after a disappointing outlook.
>> Read here: Why investment professionals rely on Europe and which stocks they particularly like
After the recent price gains, the experts had expected that investors in the German stock market would cash in at the end of the week and take profits. The leading German index marked a new high for the year at 15,659 points on Thursday.
Meanwhile, the British National Statistics Office ONS published important key figures: The economy in Great Britain was stationary at the end of last year. Gross domestic product (GDP) stagnated in the final quarter compared to summer 2022, ONS announced on Friday. Within a year, however, the economy grew by 0.4 percent. Economists had counted on that.
German exports to Russia have collapsed because of the sanctions imposed as a result of the Ukraine war, while imports have increased. The value of exports to Russia fell last year by a good 45 percent compared to the previous year, to 14.6 billion euros. This comes from data from the Federal Statistical Office. In the ranking of the most important buyer countries for German exports, Russia fell from 15th to 23rd place year-on-year.
The stock exchanges were also concerned about the threat of sanctions in the dispute over a downed Chinese balloon in the airspace of the United States. “The espionage affair has the potential to strain not only diplomatic relations between the two superpowers, but also both economies,” said portfolio manager Thomas Altmann of asset manager QC Partners.
>> Read here: US espionage dispute and economic worries weigh on the stock exchanges in China
The yield on the 10-year Bund rose at times by 6 basis points, on track to post its sharpest weekly gain since the start of the year. In view of persistently high inflation, Bundesbank President Joachim Nagel had warned against moving away too quickly from the monetary tightening course that had been embarked on.
Oil prices jump up
Oil markets soared after Russia announced production cuts. The North Sea variety Brent rose in price by a good two percent to $86.40 per barrel. From March, production in Russia is to be curtailed by 500,000 barrels per day. Energy stocks such as British oil companies BP and Shell benefited from the higher prices and gained up to three percent.
>> Read here: Interest rate worries cloud sentiment on Wall Street – tech stocks particularly under pressure
Cryptocurrency bitcoin is recovering somewhat after falling almost 5 percent on Thursday. That was the highest daily loss since November. This was triggered by speculation about stricter regulatory requirements. Bitcoin price is around $21,660 as of Friday morning.
The stock exchange year 2023 continues to show its friendly side – regardless of the daily form of the Dax. In the course of the year to date, the MSCI World Index has already gained more than eight percent in euros.
However, according to Thomas Grüner, founder and Vice Chairman of Grüner Fisher Investments, many market participants are skeptical about the upswing – for a variety of reasons. “There is still talk of inflated valuations, the mood regarding the global economy is modest and the gradual ‘return of interest rates’ means that there are apparently real alternatives to the stock market again,” says Grüner.
Basically, stock investments would like to be described as “risky”. In the current phase, however, according to Grüner, it can be said soberly: “After more than a year has passed since the stock markets marked their last high, it is above all risky to remain in the bear camp for the long term.”
The Dax all-time high from November 2021 is 16,290 points. In January 2022, the leading index was five points below it.
“Anyone who stands on the sidelines to rule out possible downward movements is taking a high risk,” says Grüner. “Because if you miss dynamic upward phases, the probability that the long-term return offered by the market will get out of reach increases significantly.” the reward is stronger.”
Look at individual values
hellofresh: A downgrade by JP Morgan puts a strain on the recipe box mailer. The analysts of the major US bank lowered their rating to “underweight” from “neutral” and the price target to 22 from 27 euros. Shares closed at EUR 25.48 on Thursday. At the close of trading on Friday, they were listed at a discount of almost twelve percent.
Standard Chartered: Speculations of a cash offer for Standard Chartered vanished after First Abu Dhabi Bank waved it off. The financial institution’s shares fell 5.5 percent to 726 pence at the bottom of the London benchmark index. The major Arab bank announced that it was not currently considering any offers for the British, in response to a report by the financial news agency Bloomberg. Standard Chartered’s share price rose more than 11 percent on Thursday.
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