Status: 08/03/2022 07:35
A possible escalation between the US and China over US leader Nancy Pelosi’s trip to Tawain is keeping markets on edge. However, the DAX should be able to maintain its level at the start of trading.
According to pre-market estimates, the first German index should start trading XETRA at 13,440 points in the morning. This is roughly in line with yesterday’s closing level. The DAX would thus initially avoid a new minus after yesterday’s losses.
US stock markets under pressure after tensions with China
The specs from the United States in the evening were anything but favorable. China’s threats over Nancy Pelosi’s visit to Taiwan weighed on sentiment. The Dow Jones Industrial ended down 1.2% at 32,396 points, slightly above its daily low reached just before. The marketwide S&P 500 fell 0.7% to 4,091 points. The Nasdaq 100 fell 0.3% to 12,902 points.
China reacted angrily to the first high-level US political visit to Taiwan in 25 years. Shortly after Pelosi landed in Taipei, Beijing spoke of a “very dangerous game with fire”. In the evening, however, the United States made efforts to defuse the situation. US National Security Council spokesman John Kirby said the trip would not undermine the US “one China” policy. “We don’t want this to escalate into a crisis or a conflict.”
Asian exchanges somewhat relieved
Asian stock exchanges reacted to these statements with relief. The Japanese Nikkei index was 0.5% higher at 27,741 points. The broader Topix index rose 0.1% to 1,928 points. The Shanghai Stock Exchange rose 0.1%.
Euro even weaker
On the foreign exchange market, the dollar “crisis currency” made its way against the euro in the wake of tensions with China. The Euro fell back below $1.02 and is currently trading at $1.0186.
Oil prices change little in the morning. A barrel of North Sea Brent currently costs $99.73. The OPEC+ oil alliance is today discussing its production strategy from September. Ahead of the Saudi-Russian-dominated group’s online meeting, the United States had called for increased production in the face of high prices. During their monthly meeting at the beginning of June, the OPEC+ countries decided to increase their production until August. This should reverse the pandemic-related cuts of early 2020.
Siemens Healthineers with logistics issues
In the German stock market, investors should look at a range of DAX company turnovers. Siemens Healthineers already presented its results in the morning: the rise in supply and logistics costs as well as the confinements in China led to a drop in profits during the last quarter. Adjusted operating income fell by almost a fifth to 765 million euros. After taxes, 364 million euros remained, eight percent less than a year earlier. Sales increased by 3.7% to nearly 5.2 billion euros.
Vonovia benefits from takeover
The takeover of Deutsche Wohnen has given new impetus to Germany’s largest real estate group. In the first half of 2022, operating profit (FFO) increased by 36% year-on-year to EUR 1.06 billion, mainly due to the acquisition. At the end of June, the average rent rose to 7.44 euros per square meter, or 2% more than a year earlier. Modernized apartments in particular contributed to the growth. The company also benefits from its new buildings. Vonovia confirmed its annual sales and profit targets.
Collective bargaining at Lufthansa
After the nationwide warning strike by Lufthansa ground staff last week, the collective bargaining partners want to negotiate with each other again. The Verdi and Lufthansa unions are meeting in the third round today to set wages and working conditions for around 20,000 employees. These include technicians, recording staff and IT experts.
Paypal action soars despite weak figures
Payments service PayPal is earning significantly less, but a major new investor is giving investors hope. In the three months to June, operating profit fell 32% to $764 million, PayPal said after the US market closed yesterday. However, Paypal increased its year-over-year revenue by 9% to $6.8 billion. The stock soared about 14% in after-hours trading. On Wall Street, the entry of the influential hedge fund Elliot was welcomed. PayPal also promised austerity measures, raising profit targets for the full year.
AirBnB and the new desire to travel
The Airbnb accommodation platform is profiting from the pent-up desire to travel after more than two years of the corona pandemic. Last quarter, sales rose 58% year-on-year to $2.1 billion. Overall, Airbnb posted a profit of $379 million, compared with a loss of $68 million a year earlier. The platform is in the midst of heavy summer activity, co-founder and boss Brian Chesky pointed out.