market report
Before the Christmas break, investors did not want to take any risks, the DAX is moving further away from the 20,000 mark. Investors in the USA also remain cautious.
The DAX closed 0.2 percent lower at 19,848 points. This means that the leading German index did not regain the 20,000 point mark before the Christmas holidays. There will be no trading on the stock exchange tomorrow on Christmas Eve. The stock exchange will also remain closed on New Year's Eve and New Year's Day. The DAX is currently forecast to gain around 19 percent in 2024.
After the sharp and rapid price slide of the previous week, the DAX remains battered and should initially face another decline, comments Christian Zoller, chart technology expert at ING. “Then we have to wait and see how far this decline runs and whether the DAX forms another low below 19,649 points or turns upwards again beforehand.”
However, Helaba's experts no longer expect strong price gains in the coming months: “After two years of above-average stock performance, only a moderate increase in prices is expected for the leading international indices in 2025. This is particularly true for the US leading indices as the most important pacesetter for the global stock market, which limits the potential.”
Holger Schmieding, chief economist at Berenberg Bank, is at least cautious: “On the stock market, many of the price drivers of 2024 will remain in place in 2025. However, given the many uncertainties, it is even more true than usual that temporary setbacks in the upward trend are certainly possible on the risk markets.”
Bad news for investors comes from companies' dividend policies. At a good 59 billion euros, the dividend total of companies in the DAX and MDAX for the 2024 financial year is likely to be almost four percent smaller than a year before. The main reason for the decline is the crisis in the automotive industry.
According to estimates by Dekabank, BMW, Mercedes and VW are likely to pay out a total of 9.9 billion euros to their shareholders, 4 billion euros less than a year ago.
According to Dekabank, 23 of the 40 companies in the first German stock exchange league are likely to increase their distribution per share for the past financial year compared to the previous year. The shareholders of the insurer Allianz can therefore hope for the largest sum of almost 5.9 billion euros.
Not much is happening on Wall Street these days either, as most investors have already closed their books for this year. The leading index Dow Jones Industrial fell by 0.6 percent to 42,586 points. The market-wide S&P 500 fell by 0.1 percent to 5,926 points. The technology-heavy Nasdaq 100, on the other hand, rose by almost 0.3 percent to 21,357 points.
Tomorrow, Tuesday, there will only be shortened trading in the USA. The stock exchanges there will remain completely closed on Wednesday. Despite the recent setback due to declining expectations of further key interest rate cuts, investors can look forward to a good stock market year in 2024. The Dow has so far increased by around 13 percent, and the Nasdaq 100 has even risen almost twice as much.
The two Japanese car manufacturers Honda and Nissan are negotiating a possible merger. Both companies announced this and confirmed corresponding media reports. A merger would create the third largest carmaker in the world after Toyota and VW. Honda and Nissan primarily want to strengthen their position in the electric car market, which is dominated by Tesla from the USA and Chinese manufacturers.
The chemical company BASF is selling its food additives business to the Dutch agricultural trader Louis Dreyfus Company (LDC). The agreement is part of ongoing strategic portfolio optimization, the DAX company said. It includes the production site in Illertissen, Bavaria: It is expected that around 300 employees would then transfer from BASF to LDC. BASF did not provide any information about the selling price.
VW shares fell today and were the biggest DAX loser. The people of Wolfsburg want to cut more than 35,000 jobs in a socially responsible manner by 2030. VW claims to save 1.5 billion euros per year by reducing labor costs. The group also promised new job security until 2030. Contrary to what has been feared, there will initially be no closure of entire plants.
Statements by NATO Secretary General Mark Rutte about necessary military spending have given defense company stocks a boost. Things continued to look up for Rheinmetall and Hensoldt today. With annual gains of 120 and 43 percent respectively, the two values are also well ahead in their indices for this period.
