2024-04-19 10:42:00
market report
Fears of further escalation in the Middle East are keeping investors on the hook. However, the markets are far from a panic reaction; now it depends on Iran’s reaction.
After Israel’s alleged attack on Iran, investors in global stock markets are taking cover. The DAX fell back to 17,627 points in early trade, but was able to pare its losses at lunchtime. Germany’s leading index is currently down 0.7 percent at 17,720 points.
After all, it was not as bad as feared before the trading session. The markets are far from panic. This is also shown by looking at oil prices, which have now fallen significantly from their early premiums.
This could also be due to Tehran’s immediate reaction: Iran is appeasing and does not see any “external attack” on Iran. “The discussion is leaning more towards infiltration than attack,” said a senior Iranian official. “Air traffic in Iran has started again, it seems that the leadership in Tehran does not want to increase the conflict any more,” explains ING expert Christian Zoller.
In the opinion of bond experts at Dekabank, how Iran reacts to the attack is also crucial. “If it really remains only this very limited counter-attack from Israel and this is being reduced by Iran, as in the first reaction, the issue could quickly move out of the focus of the markets again,” a says one analysis.
From a technical point of view, what matters now in the DAX is whether the stock market index manages to recover its 50-day line (currently 17,744 points). Otherwise, the DAX is at risk of extending the correction that has been underway since Easter next week. Investors would then have to prepare for a pullback to 17,200 points.
Things are also likely to go downhill on Wall Street at the end of the week following the latest events in the Middle East. The future on the leading US index Dow Jones Industrial Average is currently losing 0.3 percent, the future on the technology-heavy Nasdaq 100 is losing 0.5 percent.
Nervous trading is also affecting the oil market. After the prices of Brent North Sea oil and US oil WTI jumped more than four percent in an initial reaction, oil market risk premiums fell significantly by lunchtime. The price of a barrel (159 litres) of North Sea Brent is currently only 0.3 per cent higher at $87.39, well below the long-noticed $90 mark.
Gold is still well supported as a “safe haven”; A troy ounce of gold currently costs $2,382, up 0.1 percent. This morning, the price of the precious yellow metal rose up to one percent to $2,418, approaching its all-time high of nearly $2,432 per troy ounce, reached a week ago.
In the foreign exchange market, the flight of investors to safe havens has also come to a halt. The euro can even go positive against the dollar; at lunchtime, one euro pays 1.0658 dollars.
In the DAX, Rheinmetall shares were unable to benefit from the geopolitical weather situation at the end of the week. The defense company’s shares are falling even after Deutsche Bank canceled its buy recommendation earlier in the evening. Analyst Christoph Laskawi raised his price target to 510 euros, but this is only around Xetra’s current level. At its peak, Rheinmetall was already costing almost 572 euros at the beginning of April and has since corrected almost twelve percent.
According to the boss of BASF, Martin Brudermüller, the end of the weak demand in the chemical industry is approaching. “We see a bottom forming,” said Brudermüller in an interview with the “Neue Zürcher Zeitung”. “The decline in prices and sales volume has stopped,” he said. But he doesn’t want to talk about radical change just yet.
British low-cost airline Easyjet currently sees little room for significant growth in Germany due to high aviation fees. Easyjet board member and European boss Thomas Haagensen criticized that the location costs of flying, which are high compared to international standards, prevented significant growth. “Germany is not competitive in Europe.”
With a strong increase in new customers of 9.3 million, Netflix significantly exceeded market expectations for the second quarter in a row. Sales rose nearly 15 percent to $9.4 billion. Profits nearly doubled to $5.28 per share.
The Facebook company Meta is releasing a new, more powerful version of its AI model. The software, called Llama-3, is intended, among other things, to bring new functions to apps such as Instagram and WhatsApp and run in the in-house assistant Meta AI.
The French cosmetics group L’Oréal had a very good start to the year due to strong demand in Europe and North America. In the first quarter, sales rose 8.3 percent year-on-year to a good 11.2 billion euros – which was much more than analysts had expected on average.
#Market #report #Investors #nervous #situation #Middle #East