Status: April 13, 2022 6:08 p.m.
Inflationary pressures on central banks and bad news from Ukraine continue to shape the picture. However, since nothing significant has changed, the stock exchanges are robust.
New York stock markets extended their slight gains into the early evening. The main Dow Jones index is currently trending up 0.5%, while Nasdaq tech stocks are rallying more than 1%. Producer prices rose even more strongly than expected in March. The 11.2% increase was the largest price increase since the survey began in 2010.
JPMorgan kicks off US earnings season
US financial giant JPMorgan meanwhile kicked off the US reporting season with sobering numbers. According to the house of money, the war in Ukraine caused approximately half a billion dollars of charges to the balance sheet in the first quarter. Net profit fell 42% to around $8.3 billion, according to the largest US bank in New York.
DAX strength signal
Like yesterday, the DAX managed to counter a slide below 14,000 points, which technical analysts interpret as a signal of strength. Tomorrow’s ECB meeting promises more clarity on how monetary policy will react to the wild price move. The general expectation is that the central bank will remain rather cautious. However, it could signal more clearly than before a rise in key rates at the end of the year. Before doing so, however, it must end its stock purchase program, which is expected to take place in the third quarter.
Economists lower their economic forecasts
Meanwhile, there is no cause for optimism in Germany: the five major economic research institutes have significantly lowered their economic forecasts for this year. They are now only expecting growth of 2.7% instead of the 4.8% expected in the fall. They estimate that inflation will be 6.1% this year. “Besides the war in Ukraine, the unfavorable development of the pandemic during the last winter semester is decisive for the revision,” according to the institutes. For the coming year, they expect gross domestic product (GDP) to grow by 3.1%.
Economy update from 04/13/2022
Stefan Wolff, HR, tagesschau24 9:05 am, April 13, 2022
Euro fixed in the afternoon
The common European currency is trading at $1.0860 in the early evening. Apparently there is currently increased speculation in the FX market for signs of monetary tightening at the ECB meeting tomorrow.
Oil prices continue to rise
Oil prices continue their upward movement. A barrel of North Sea Brent currently costs US$107.40. Oil prices were also boosted yesterday by the easing of corona measures in the Chinese financial metropolis of Shanghai. Along with the prospect of renewed demand for crude oil, fears of a supply shortage are also supporting prices given the war in Ukraine. The surprisingly significant increase in US crude oil inventories last week had little impact on the upside move.
Twitter shareholders sue Elon Musk
Tesla CEO Elon Musk may have broken the law by becoming Twitter’s largest shareholder. The lawsuit in federal court in New York alleges that Musk violated a regulatory deadline to disclose that he acquired at least a 5% stake in Twitter. Instead, he did not disclose his investment until he acquired a stake of more than 9%. A class action lawsuit is being sought to represent Twitter shareholders who sold shares between March 24 and April 4.
Telekom increases its stake in its American subsidiary
Deutsche Telekom has further increased its stake in subsidiary T-Mobile US to 48.4% of the capital. The group is acquiring an additional 21.2 million shares of T-Mobile US from the SoftBank group for $2.4 billion. This corresponds to an average price per share of 113 dollars. To finance the purchase, Telekom is also using part of the approximately four billion euros it received from the sale of T-Mobile Netherlands.
Fraport hailed by traffic figures
The American investment bank Goldman Sachs left the buy recommendation for Fraport with a target price of 64 euros. European infrastructure stocks belonged to an asset class with attractive valuations. In March, the airport operator transported 2.94 million passengers to its most important location in Frankfurt. This was 217% more than a year earlier, but still 47% less than before the corona pandemic in March 2019. In the freight sector, activity fell by 13.3% to 177 million tons.
K+S raises its forecast
In the MDAX, K+S stock again caught the eye with gains. High potash fertilizer prices make the company more optimistic for the current year. Group boss Burkhard Lohr expects an increase in operating profit (Ebitda) to 2.3 to 2.6 billion euros. So far, 1.6 to 1.9 billion euros had been provided for in the plan, after just under a billion euros last year. The company intends to present a full year outlook when it presents its first quarter figures on May 11.
Auto1 stock remains under pressure
Shares of online car dealership Auto1 fell 3.9%. With a minus of over 40%, it is one of the biggest losers in the SDAX of the current year. JPMorgan analyst Marcus Diebel testified that the company had slightly better-than-expected sales figures in the first quarter. Sales increased 30% in the first quarter to 169,600 units.
LVMH revels in luxury
After positive reactions from analysts to the activity figures for the first quarter, the LVMH share was sought after. UBS experts also see LVMH’s strong start to the year as a positive signal for other luxury goods groups and brand manufacturers. At the analyst conference, management made a “confident and relaxed impression,” according to UBS analyst Zuzanne Pusz. Compared to the same period of the previous year, which had been affected by the pandemic, sales in the first quarter increased by 29% to 18 billion euros, mainly thanks to the fashion and leather goods business. This was much more than analysts had expected on average. On a like-for-like basis and adjusted for currency effects, growth was 23%.
Hypoport is fine
Financial services provider Hypoport entered the new year with strong growth. In the first quarter, the volume of transactions on the internal credit platform Europace increased by 26% year-on-year. Business volumes also increased in the other divisions with double-digit percentages. MDAX-listed stocks rose moderately.