Frankfurt After a winning streak lasting several days, the German stock market allowed itself a short recovery on Wednesday. The Dax closed on Wednesday at 13,281 points, just below the level of the previous day.
In terms of individual values, Hellofresh was the main focus on Wednesday. For a long time, the recipe box mail-order company led the Dax winners list by a large margin. But then the group presented figures for the second quarter.
These were better than expected – the decline in adjusted operating profit from April to June was less than expected, and revenue growth was also above analysts’ forecasts.
However, Hellofresh is cutting its full-year targets. For the year as a whole, the group now expects adjusted earnings of between 460 and 530 million euros instead of 500 to 580 million. The sales forecast was also reduced.
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That made the stock fall from the top to the end of the Dax. Hellofresh titles recently lost ten percent and were below the 30 euro mark.
On the other hand, the shares of Just Eat Takeaway were in demand, which at times rose by almost 14 percent in Amsterdam. Analysts praised the planned job cuts at the “lieferando” mother in France. This fuels optimism that breakeven is approaching. Delivery Hero stocks reached their highest level in the MDax since April. They were listed 6.5 percent higher.
Overall, a possible recession is still the key issue on the markets. Deutsche Bank Research expects German gross domestic product to fall by around one percent in 2023. In a “keep the gas tap closed” scenario, GDP could even drop by five to six percent in 2023. This negative but possible scenario shows that gas supplies from Russia will be stopped prematurely.
In the three previous crises (financial crisis, euro crisis and corona crisis), the Dax had fallen back to its respective book value, according to the Landesbank Baden-Württemberg (LBBW). The Dax book value is currently almost 10,000 points. In the event of a severe recession, a slump in book value is conceivable again. However, LBBW sees the Dax in its forecasts on June 30, 2023 at a level of 14,500 points again.
Investors are now focusing on the meeting of the European Central Bank (ECB) on Thursday. The central bank will raise interest rates in the euro area for the first time since 2011. It is still unclear whether it will raise interest rates by 25 or even 50 basis points. In view of the record high inflation of 8.6 percent recently, more and more experts and monetary authorities had spoken out in favor of a significant interest rate hike.
In addition, President Christine Lagarde should make it clear that the rate-hike cycle has only just begun, says Martin Wolburg, senior economist at Generali Investments. However, the timing and size of future rate hikes depended on the expected mix of growth and inflation. Markets would therefore listen carefully to any comments on recession risks.
In Germany, inflation has slowed down somewhat, albeit at a high level. As a result of the Ukraine war, German manufacturers again raised their prices massively in June, but not at record speed.
Producer prices climbed by an average of 32.7 percent over the year, as the Federal Statistical Office announced on Wednesday. In May, the increase was still 33.6 percent and thus higher than at any time since the beginning of the survey in 1949.
Look at the individual values
Continental: Investors reacted enthusiastically to the key data for the second quarter. The stock rose 3 percent at its peak. At the end of trading, the plus was still 0.62 percent.
Akzo Nobel: The paint group under the corona lockdowns in China and a decreasing demand for wall paints in Europe. Sales increased in the second quarter by 14 percent to 2.85 billion euros, as the Dutch company announced on Wednesday.
However, adjusted operating profit fell by more than a quarter to 249 million euros and was therefore below analysts’ expectations. Chief Executive Thierry Vanlancker said results were weighed down by the two-month lockdowns in China and de-stocking of DIY decorative paints in Europe. The stock lost 1.5 percent.
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