German Shares Experience Plunge as Reports Suggest Bafin asked Deutsche for Simulating Split

The Financial Regulator of Germany, Bafin has asked Deutsche Bank AG for simulating a split, despite of the report that stated that the investor confidence in German stocks have seen a rebound on this month. As a result, the German stocks have experienced its biggest fall in this week. The benchmark gauge DAX Index experienced a decline of 1.9% and is currently at 7688.65. The index, at one point time declined by 4%, however, recovered from that position at a later time. If the volume of the shares changing hands is considered, it was 20% more in comparison with the 30-day average. The broader HDAX Index, on the other hand, got down by 0.7% on today.

According to Stephane Ekolo, a bit of negative sentiment is weighing up on the market. Stephane stated that it is expected that the banks go down in near future. Apart from that, there are lots of rumors hurting the market even more, as commented by Stephane. Incidentally, Stephane is the Chief European Strategist of Market Securities.

Bafin has requested Deutsche to simulate a split of business. This news is yet to be confirmed officially though. Incidentally, a group led by the Governor of Bank of Finland, Erkki Liikanen, has already asked to the banks for doing their trading activities in a separately capitalized unit and many feel that the move of Bafin was prompted because of this.

Incidentally, Deutsche Bank is the largest lender of Germany and as the news surfaced, it experienced a plunge of 1.9% today. Each of the lender’s shares is currently priced at 35.94 Euros. Spokesperson of Deutsche Bank, Christian Streckert didn’t want to make any comment on this matter or the earnings outlook of the lender either.

Among others, Continental also experienced a slump of 1.1% and each share is currently priced at 84.19 Euros. According to Michelin & Cie., a French rival of Continental, the demand of tires have gone down last month throughout the Europe and this created negativity among investors on Continental.

Wirecard AG suffered a loss of 4.5% as this renowned provider of software and systems for the online payments was cut from buy to hold by Berenberg Bank AG. Incidentally, Wirecard experienced a jump of 50% in last year and that’s the reason analysts gave while cutting down the same.