Stock exchange in Frankfurt - Dax momentum wanes somewhat
Following the Fed's clear signal that it is likely to cut interest rates several times in 2024, the DAX surpassed the 17,000-point mark for the first time in its history. The momentum then slowed somewhat. Stable key interest rates from the European Central Bank (ECB) in the afternoon initially had little impact.
Germany's leading index recently recorded a gain of 0.55% to 16,857.71 points. The gain in the course of its year-end rally since the interim low in October thus amounts to just over 15 percent. The Dax is a so-called performance index. This means that company dividends are included in the calculation.
The indices behind the Dax fared even better. The MDax of mid-caps rose by 2.73% to 27,150.30 points. The second-line index SDax gained 3.46 percent to 13,526.80 points. The eurozone index EuroStoxx also rose by around 0.8 percent.
Real estate shares reacted to the new interest rate prospects with high price gains. Vonovia, for example, climbed almost eight percent in the Dax. Patrizia in the SDax even gained over 15 percent. The European real estate sector, the strongest in the Stoxx 600 sector overview, rose by 5.4 percent. Construction and real estate financing is becoming cheaper again as interest rates fall, which can boost demand on the housing market.
A report in "Spiegel" caused shares in Telekom and DHL to fall sharply by 3.6% and 1.0% respectively. According to the magazine, the German government wants to finance the restructuring of Deutsche Bahn by selling shares in Telekom and DHL.
The euro initially reacted positively to the ECB's decision on Thursday, but then fell back slightly to 1.0913 US dollars. The ECB had set the reference rate significantly lower at 1.0787 dollars on Wednesday.
On the bond market, the current yield fell from 2.24 percent the previous day to 2.08 percent. On the other hand, the bond index Rex rose by 0.84 percent to 127.89 points. The Bund future recently fell by 0.07 percent to 136.23 points.
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The DAX, reaching a historical high of 17,000 points due to anticipation of interest rate cuts by the US central bank, experienced a slight deceleration later. The US central bank is not mentioned in this sentence, but the context implies it.
The ECB, unlike the US central bank, maintained stable key interest rates, initially having little impact on the DAX's momentum.
Germany's benchmark index, the Dax, gained significantly since its October low, with even the smaller indices SDAX and MDAX performing better.
Shares of Telekom and DHL saw a decline following a report in "Spiegel" suggesting that the German government plans to finance Deutsche Bahn's restructuring by selling shares in these companies.
Frankfurt, being home to the German Stock Exchange, saw indices like the DAX, SDAX, MDAX, and EuroStoxx record gains due to favorable market conditions.
The fall in interest rates is beneficial for the real estate sector in Germany, with companies like Vonovia and Patrizia seeing substantial price increases.
Source: www.stern.de
