Stock Market Update: DAX Surges Prominently - Lowered US Interest Rate and Tech News from America
In a positive turn for the German stock market, the benchmark index, DAX, saw a gain of 1.15 percent in the early afternoon, reaching 23,628.70 points. This rise was driven in part by the demand for technology stocks.
Yahoo Finance reported that Zalando, the online fashion retailer, was the top performer in the DAX, with a gain of 5.9 percent. Major shareholder Anders Holch Povlsen bought shares worth over 9.7 million euros on the previous Friday, contributing to Zalando's strong performance.
Other notable gains in the DAX included SAP, with a rise of 4.00 percent, and Commerzbank, which saw a gain of 3.83 percent. SAP and chipmaker Infineon were among the top picks of investors in the DAX, with gains of more than four percent each.
The focus of the day was the spin-off of Continental's auto parts division Aumovio as a separately listed company. The temporary expansion of the DAX to 41 stocks was a result of this spin-off, with Continental's share price increasing by five percent after adjusting for the spin-off. The initial Aumovio share price was 35 euros, and it reached 36.70 euros at one point. However, the new stock will be removed from the DAX at the close of trading.
Meanwhile, the Eurozone benchmark EuroStoxx 50 rose by 1.5 percent, and the MDax of mid-sized companies gained 0.75 percent to 30,443.39 points. Aixtron and semiconductor wafer maker Siltronic topped the charts in the MDax and the small-cap index SDax, with gains of 8 and 13 percent, respectively.
However, not all stocks saw gains. Puma shares fell back 3.9 percent as takeover rumors faded. No potential buyer for Puma was confirmed, with speculation including private equity firm CVC, US brand management company Authentic Brands Group (ABG), and Adidas. Analysts were skeptical about a possible Puma takeover by Adidas on Thursday.
The US Federal Reserve added to the global economic outlook with its decision to cut interest rates for the first time this year, by 0.25 percentage points. The Fed also hinted at up to two further rate cuts by 2025 and another in 2026, which may have contributed to the positive sentiment on the German stock market.
In conclusion, the German stock market saw a strong day of trading, with the DAX gaining 1.15 percent. The demand for technology stocks, the positive impact of the Aumovio spin-off, and the Fed's interest rate cut all played a role in the day's gains. However, the fate of Puma remains uncertain as takeover rumors continue to swirl.
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