Extending the longest rally for the benchmark gauge of German stocks, DAX Index in the last 5 months, German stocks have gone ahead. Investors are speculating that Central banks will go for further easing in their monetary policies and this has helped the shares even further. The DAX Index went ahead by 1.3% and it is currently at 7.759.03. On yesterday, the gauge went ahead by 2.4% amid speculation that the European Central Bank will be decreasing the interest rates. When it comes to the broader HDAX Index, the same went ahead by 1.2% on today. The total volume of shares changing hands on today was 27% less than the average of the last 30 days.
According to the Portfolio Manager of Aimed Capital Management LLC, Daniel Weston, the economic data does not look like bullish, however, it pays to ignore the fundamentals at this time and it asks to run with the momentum in these markets. The cash continues to bid up equities and the hunger for gains trumps the headwinds.
According to the 3 popular lenders: Commerzbank AG, UBS AG and Nomura Holdings Inc., the European Central Bank will be cutting down the refinancing rate by 25 basis points to 0.5% at the next meeting to be held on 2nd May. Many economists also feel that the Central Bank will be lowering the benchmark interest rate from its current value of 0.75%.
Among the companies, Deutsche Post shares increased by 4.5% and each share is currently priced at 18.29 Euros. JPMorgan decided to upgrade the stocks to overweight from normal and hence the mail delivering company was benefitted. JPMorgan added that Deutsche Post is expected to climb another 25%. Berenberg also increased the stock’s rating from hold to buy.
Third largest luxury carmaker in Germany, Daimler AG, saw its shares declining by 0.8% to 40.58 Euros per share. The company cut its profit forecast for 2013. The 1st quarter Ebit published by the company declined by 56% and it is not expected to match last year’s 8.1 billion Euros.
The biggest maker of automated teller machines in Europe, Wincor Nixdorf AG shares declined by 3.6% and each share is currently priced at 38.60 Euros. The preliminary profit posted by the company is of 17 million Euros for the 2nd fiscal quarter. Apart from that, revenue was of 597 million Euros.