Deutsche Post's lead in the market is being defended by DAX, a prominent contender.
Deutsche Post Leads DAX for Second Consecutive Day
Shares of Deutsche Post surged over three percent at the close of trading on Wednesday, leading the DAX list for a second consecutive day. The trading of shares resulted in an increase of over three percent, making it one of the top performers in the German stock market.
The DAX, Germany's blue-chip index, gained on Wednesday, closing at 12,928.57 points, an increase of 0.17 percent compared to the previous day. This growth was primarily due to positive investor sentiment driven by strong corporate earnings reports and expectations of a stable U.S. Federal Reserve interest rate policy. Futures indicated gains in European markets, including the DAX, as investors reacted well to earnings announcements dominating the calendar and anticipation that the Fed would maintain current rates for the fifth consecutive meeting.
Among the companies ahead of Deutsche Post in the DAX list on Wednesday were Covestro and BASF. However, Deutsche Post has raised its earnings forecast for 2020, now expecting the group's EBIT to be between 4.1 and 4.4 billion euros. This upward revision likely stems from better-than-expected revenue, cost control, or improved demand in logistics and parcel delivery sectors.
On the other hand, the trading of shares of Deutsche Börse resulted in the largest losses in the DAX on Wednesday, with a decrease of over three percent. Bayer and Munich Re also experienced losses on Wednesday.
The euro strengthened on Wednesday afternoon, trading at 1.1769 US dollars (+0.31 percent). The euro strengthened further, trading at the same rate in the afternoon on Wednesday.
Overall, European equities, including the DAX, have been buoyed in 2025 by a growth-focused political agenda in Germany, strong inflows into DAX and STOXX ETFs, and cyclical exposure to strong industrial demand in the eurozone. Investors are optimistic due to solid earnings, stable monetary policy expectations, and a supportive economic environment for major German industrial and logistics companies, which likely supported both the DAX gains and Deutsche Post's confident earnings forecast revision.
- In contrast to Deutsche Post, other major German industrial companies, such as Deutsche Börse and Bayer, experienced losses in the finance sector on Wednesday.
- Despite the positive growth of the DAX, the German stock market's blue-chip index, other industries, like the logistics sector, continue to exhibit strong demand, as evidenced by Deutsche Post's upward earnings revision for 2020.
