German Equities Close Higher with Gains in Tech and Consumer Sectors
Germany equities closed higher on Friday, with the DAX rising by 0.54% and the MDAX by 0.33%, while the TecDAX surged by 0.88%. The positive momentum was driven by strong performances in the technology and consumer sectors.
Among the top performers were Henkel AG, which rose by 7.22%, Rheinmetall AG, which added 4.72%, and Vonovia SE, which gained 3.12%. On the other hand, Daimler Truck Holding AG, Munich Re, and Commerzbank AG were the worst performers of the session.
In the mid-cap index, Siltronic AG, Hensoldt Ag, and Puma SE saw significant gains, while Sixt SE, Aurubis AG, and Delivery Hero AG struggled.
The volatility in the DAX 30 options remained unchanged at 14.64%, as gold futures and WTI crude oil futures prices saw slight declines. The EUR/USD exchange rate remained steady at 1.08.
Overall, 339 stocks rose on the Frankfurt Stock Exchange, outnumbering the 266 stocks that closed down. The market sentiment remains positive, with investors closely monitoring geopolitical events and economic indicators for further direction in the coming weeks.
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German stocks higher; DAX 30 up 0.54% at close By Investing.com
Elon Musk visits China, the largest car market
For the second time in less than a year, the main partner of Tesla, Elon Musk, traveled from the weekend to Chinathe world’s largest electric vehicle market, where the prime minister Li Qiang He promised yesterday that the country will “always” remain open to foreign companies.
Musk arrived “at the invitation of the Chinese Council for the Promotion of International Trade,” the official network reported. CCTV.
The visit had not been announced. According to CCTV, Li declared during the meeting that “the immense Chinese market will always be open to companies with foreign capital.”
“China will keep its word and continue to work hard to expand market access and strengthen guarantee of service”, he assured.
Beijing will also offer foreign companies a “better business environment,” so that “companies around the world can have the mind calm when investing in China”, stressed the prime minister.
China has many commercial interests to Elon Musk, who last visited the country in June 2023.
The Tesla factory in Shanghai produced almost one million vehicles in 2023, 40% destined for export to markets in Asia and Europe.
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Mexico’s GDP will grow above OECD countries, but adjusts estimate
Mexico City. Mexico will grow this and next year above the average of the countries that make up the Organization for Economic Cooperation and Development (OECD), the organization itself revealed, although it made a downward adjustment for its 2024 estimate. A “market “solid labor market”, with historically low unemployment rates, added to the investment in public infrastructure projects and the relocation of companies to the country explain the behavior of the Mexican economy, he explained.
“Private consumption will be a key driver of growth, supported by low unemployment and rising real household incomes. Private investment will gradually benefit from the relocation of manufacturing activity to Mexico. “Exports will continue to benefit from deep integration into manufacturing value chains,” she detailed.
The OECD reduced its growth outlook for 2024 from 2.5 to 2.2 percent. For 2025 it estimates a slowdown to 2 percent. Both forecasts are above the average of countries that make up the organization, 1.7 for this year and 1.8 percent for the next. However, it is below the organization’s projected global growth of 3.1 and 3.2 percent for this and next year, respectively.
The organization stated that in Mexico domestic demand is resilient, in part because “the labor market is solid, with historically low unemployment (2.5 percent in February)”; which is accompanied by an increase in formal employment and a slight reduction in informality. The lag is seen in women’s participation in the labor force, although it has increased, “it remains significantly lower than in its regional peers and other OECD countries.”
The organization also points out that industrial participation in the country has recovered after some weakness in 2023, partly due to the push for relocation and which is observed in the industrial parks that border the United States border, which are located next to it. maximum capacity, while warehouse rental prices and the construction of additional industrial spaces are increasing, the OECD detailed in its Economic Outlook, published this May 2.
Uncertain inflation outlook
In accordance with what is forecast by the OECD, general and underlying inflation in Mexico is expected to continue slowing until reaching the Bank of Mexico’s objective of 3 percent with a range of one percentage point, until the third quarter of 2025. ” However, the inflation outlook remains very uncertain. Inflation may be more persistent than expected, especially in services,” he warned.
In Mexico, reductions in official interest rates are expected to accelerate from the second half of 2024. At this point, the OECD recommended that monetary policy remain restrictive and new interest rate cuts be gradual. Estimates suggest that the reference rate, currently at 11 percent, will drop to 7.50 percent by the end of 2025.
Renewables as a comparative advantage
Although the OECD estimates that the ratio of debt to gross domestic product (GDP) remains around 50 percent, it recommended increasing tax revenues. To achieve this, it proposes various routes, expanding the base of the personal income tax, promoting the collection of real estate tax and continuing to fight against tax evasion. He also recommended promoting policies on renewable energy and water management to take advantage of the relocation of supply chains.
“Adopting regulations that promote private sector investment in renewable energy would help turn Mexico’s great renewable energy potential into a competitive advantage. Improving water management, reducing risks and operating costs and promoting environmental sustainability, would make Mexico an even more attractive destination for the nearshoring”he advised.
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– 2024-05-04 02:02:59
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Mexico’s GDP will grow above OECD countries, but adjusts estimate