There hasn’t been a day in the past week when the turbulence in the markets hasn’t kept us on our toes: The international stock exchanges have had their worst half-year in decades. First the fear of rising interest rates spoiled the mood, now the growing fear of a global recession is causing sharp price fluctuations. On Tuesday, the Dax fell to a new low for the year at 12,390 points.
On the foreign exchange market, the euro is at its lowest level in 20 years and is getting closer and closer to the dollar. Experts believe that the two currencies will soon be evenly matched. From their point of view, this is mainly due to the strength of the dollar. Although there are also concerns about a recession in the USA due to the Fed’s turnaround in interest rates, they are less serious than the concerns about a recession in the euro zone due to an energy crisis.
Commodity prices also fell: On Wednesday, oil prices fell below $100 for the first time since April, and copper prices fell to their lowest levels since November 2020.
As business and financial journalists, we are quite fine when there is movement in stocks, bonds, foreign exchange, commodities and the like. Anything is better than standing still. But the constant ups and downs in the markets worry us too. Especially since experts like Mohamed El-Erian assume that the turbulence will continue. The prominent US economist sees three risks: rising interest rates, weaker corporate profits and that the markets could no longer function properly in some areas. “The liquidity risk is increasing,” warns El Erian in conversation with my colleague Astrid Dörner and recalls extreme situations like in spring 2020 after the outbreak of the corona pandemic. At that time, even in markets that are usually extremely liquid, such as the market for US government bonds, suppliers and buyers could no longer easily find each other.
The fluctuations on the markets will keep us busy in the editorial office for a long time, and I fear even more. Whether reports, analyzes or investment tips – with us you will find everything you need to know.
By the way, if you’re thinking about buying stocks now, then you should know the VDax – and read the article by my colleague Jürgen Röder.
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What else has kept us busy this week?
1. Shortly before the parliamentary summer break, the Federal Council decided on a number of important legal changes on Friday, for example the use of more coal-fired power plants, the faster expansion of green electricity and facilitation of state aid for ailing energy companies such as Uniper.
Germany’s largest gas trader is now officially calling for support from Berlin. “The federal government has created the necessary instruments for this, now we hope for a quick solution,” said Uniper boss Klaus-Dieter Maubach. At the current gas prices, losses of up to ten billion euros will accumulate in the coming months.
2. With the threatened stop in Russian gas supplies, Germany is facing a winter of emergency. What happens when push comes to shove, and how the future of German energy policy should go, is what our weekend title “Cold, dark, expensive” describes.
3. Speaking of green electricity: Wind power is to become the most important energy source of the future, but the expansion is hardly progressing in Germany. In the new episode of her podcast Handelsblatt Green, our energy expert Kathrin Witsch talks about why this is and how the problems can be solved with opponents of wind power, companies and experts.
4. At first glance, the situation in Russia seems surprisingly relaxed: the supermarket shelves are full, local transport works, and despite the current devaluation, the ruble is stronger than before the sanctions came into force. Underneath, however, a mixed situation is brewing that will damage the Russian economy for decades, according to the experts my colleague Mareike Müller spoke to. The chart shows that gross domestic product is likely to collapse massively in the current year.
Have you ever asked yourself what Russia does with the gas that is not exported now? Yes? Then I recommend our story “Suddenly too much gas”.
5. Shocking news and pictures reached us on Friday morning: Japan’s longtime prime minister is making a campaign speech when a shot is suddenly fired. Shinzo Abe goes down. On the way to the hospital, his heart stops. The doctors can no longer help the 67-year-old. Our Tokyo correspondent Martin Kölling explains what consequences the deadly attack could have on the country.
Moreover, it comes at a time in which hedge funds bet massively against Japan’s central bank and the traditional low interest rate policy could very soon plunge the country into chaos.
6. The first Dax companies are increasing their salary budgets because of the high inflation. This is the result of a Handelsblatt survey of the 40 largest listed companies in the country. Although the inflation rate in Germany fell slightly in June, as the graphic shows. However, experts attributed this to special effects such as the nine-euro ticket and the fuel discount and warn of further price increases for energy and food.
7. Many consumers in Germany are already noticing the significantly higher prices in the supermarkets – and can hardly afford to buy groceries. This is shown by a study of more than 600,000 receipts that the market researcher Smhaggle evaluated exclusively for the Handelsblatt. Even switching to discounters brings no relief.
8th.We made bets this week: Was it one scandal too much for Boris Johnson or, as is so often the case, is he getting the hang of it? When reports first came in on Thursday that the British Prime Minister wanted to step down as Conservative Party leader and address the nation later in the day, we watched the door of 10 Downing Street government seat. It wasn’t until he came out and confirmed the reports that we couldn’t believe it.
But Johnson wouldn’t be Johnson if he just walked away. He wants to remain in office until a successor is elected, which not only enrages members of the Labor Party. Since our London correspondent Torsten Riecke has written countless texts on the government chaos in London over the past few days, the best thing to do is click on our website handelsblatt.com and search for his name.
9. The tax burden in Germany has increased. And more and more taxpayers are slipping into the top tax rate. This is shown by new data from the federal government. They clear up some tax myths and may provide some surprising insights. But see for yourself!
Finally, some numbers that make us very happy: The Handelsblatt is one of the winners of this year’s reader analysis of decision-makers in business and administration, LAE 2022 for short cross-media reachwhich is made up of the average readers per issue of the print titles and the monthly number of users of the online offers and apps, we were able to increase by 7.8 percent to more than one million decision-makers (digitally it is 771,000). As the only title in the entire German newspaper segment, we were also able to increase the print reach compared to the previous year.
sincerely
Her
Kirsten Ludowig
Deputy Editor-in-Chief Handelsblatt
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