German stock market outlook 2019: is the economic upswing over?
Concerns over the strength of the German economy are growing. A steady upswing of the eurozone’s powerhouse may be over. The weaker economic growth expected this year is considered “a wake-up call” for the government. Let’s find out what to expect from the German stock market news in light of gloomy official figures.
Stormy times for the German economy
According to the recent updates, this year the German government expects a weaker gross domestic product growth of 0.5 per cent, which is 1 per cent weaker than previously forecasted. With leading economists lowering their price forecasts to 0.8 per cent, this forecast seems even more pessimistic.
Peter Altmaier, the German minister of the economy, called the new figures a “wake-up call” for the country, pushing officials to think of ways to stimulate growth and future development. Among the reasons of a weaker forecast, Mr Altmaier mentioned an overall slowdown of the global economy, the heated trade conflict between the US and China, and the UK’s Brexit, affecting the German export market.
Selling a large share of its products abroad, Germany is heavily exposed to global political uncertainty, which affects international trade. The slowdown of the Chinese economy is also expected to have an adverse impact on Germany. The country would suffer from additional tariffs on car imports, steel and aluminum.
German stock exchange
Germany represents the largest and the strongest economy in Europe, and the 3rd biggest economy in the world behind the US and Japan. In general, the German stock market consists of eight different stock exchanges, located in various parts of the country.
The WTO has announced Germany to be the largest exported of goods in the world. Therefore, it’s no wonder why the German stock exchange is considered one of the most powerful, defining the state of the international trade and commerce.
German stock market components
- Frankfurt stock exchange (FWB) is the primary German stock exchange, with the largest number of listed companies. Located in Frankfurt and owned by Deutsche Börse, FWB is considered one of the biggest securities trading centers in the world. The major index traded in Frankfurt is DAX 30.
- Stuttgart stock exchange is the second most prominent stock exchange in Germany. Some of the leading German financial companies, including LBBW Bank, Wustenrot and Allianz Life Insurance are listed and traded there.
- Berlin-Bremen stock exchange is headquartered in Berlin-Charlottenburg. Officially established in 2003, the exchange was founded by the merger of the Berlin stock exchange (one of the oldest stock exchanges in Germany) and Bremen stock exchange.
- The BÖAG Börsen AG was founded in 1999, when Hanover and Hamburg stock exchanges were merged.
- Hamburg stock exchange is the oldest stock exchange in Germany, started back in 1558. It has 2 major divisions, the general exchange, used by property companies and estate agents, and individual exchanges, including the Insurance Exchange, Coffee Exchange and Grain Exchange.
DAX 30 stock market Index
Launched in 1987, the DAX 30 – the Deutscher Aktienindex – is a benchmark index of the German stock market, which tracks the value of 30 biggest and most actively traded companies listed on the Frankfurt stock exchange.
Often viewed as a gauge of the German economy, the DAX 30 index is one of the major national indices in Europe. Representing around 75 per cent of the total cap of the Frankfurt stock exchange, the DAX index consists of mainly manufacturing-heavy businesses.
It comprises automobile and chemical giants like BASF and BMW. The Big Three auto-makers – BMW, Volkswagen and Daimler (parent company of Mercedes) – take up a large part of the DAX’s weighting.
One of the most popular ways to trade the DAX 30 index is to use contracts for difference (CFDs). Trading German shares through CFDs enables you to go long or short without referring to traditional exchange. You trade direct with your CFD platform provider.
One of the most widely-traded indices in Europe and worldwide, DAX 30 always provide traders and investors with high liquidity, tight spreads and long trading hours. Popular among CFD traders all over the world, the DAX 30 is a benchmark index, highlighting the state of the German stock market.
German stocks to invest in: top 10 DAX 30 market movers
The best performing German stocks (as of 8 July 2018):
|BASF SE||62.81||The world’s leading chemical producer|
|SAP||123.82||A multinational software development company|
|ADIDAS||279.20||The largest sportswear manufacturer in Europe|
|BEIERSDORF||107.60||A company specialising in personal care products|
|ALLIANZ||217.65||An International financial services company|
|VOLKSWAGEN||155.00||A multinational automobile producer|
|DEUTSCHE BOERSE||128.60||A marketplace for trading|
|VONOVIA||44.22||A residential property company|
|MUENCHENER RUECKVER||226.60||An insurance company |
|WIRECARD||152.55||A global IT and financial services company|
The latest DAX 30 worst performing stocks are:
|SIEMENS||101.08||A semiconductor manufacturer|
|MERCK||93.50||A pharmaceutical and life sciences company|
|DEUTSCHE BANK||7.05||An investment bank and financial services company|
|DAIMLER||48.78||An international automotive corporation|
|HEIDELBERGCEMENT||68.38||Building materials producer|
|E.ON||9.62||An electric utility company|
|LINDE||179.25||A multinational gas and chemical company|
|INFINEON||16.11||A semiconductor manufacturer|
|FRESENIUS||47.53||A Healthcare products manufacturer|
|RWE||22.81||A utility company|
Historically, the Germany DAX 30 Index reached an all-time high of 13,559.60 in January 2018. The DAX 30’s record low of 372.30 happened in November 1974.
Since the beginning of 2019, the DAX 30 performance has been rising – the stock market index has gained 18.84 per cent. On Monday, 8 July 2019 the DAX 30 stock market index was trading at 12,533. To follow the most recent ups and downs of the DAX 30 Index, check out the DAX 30 news and follow our live price chart.