DE40: Dax continues upward movement after ECB rate cut

• German DAX remain in the ATH zone
• Munich Re shares gain after the German reinsurance giant announced ambitious 2025 targets, forecasting a net profit of €6 billion.
• Daimler Truck Financial Services, part of Daimler Truck, has revealed it is owed approximately $139 million

General market overview: European stock markets are broadly higher on Friday, with Spain's SPA35 leading gains (+0.75%), followed by Germany's DE40 (+0.49%) and France's FRA40 (+0.32%). The pan-European EU50 index is up 0.41%, while Italy's ITA40 has gained 0.26%. Other major indices showing positive performance include Austria's AUT20 (+0.44%), the UK's UK100 (+0.44%), and Switzerland's SUI20 (+0.15%).

Dax Returns by Sector. Source: Bloomberg Financial LP

Looking at the German DAX sector performance the market shows mixed results with Financials leading gains (+0.54%), followed by Information Technology (+0.27%) and Communication Services (+0.10%). Consumer Discretionary adds 0.04%, and Industrials edges up 0.05%. However, several sectors are in negative territory, with Real Estate showing the steepest decline (-0.88%), followed by Utilities (-0.82%), Health Care (-0.61%), and Materials (-0.35%). Consumer Staples is also down (-0.54%). The overall DAX is up 0.4%, with market breadth somewhat weak as declining sectors outweigh advancing ones in terms of magnitude, despite relatively modest moves in either direction.

Volatility is currently observed in the broader European market. Source: xStation

The German DE40 Index is trading at an all-time high, fueled by strong bullish momentum. The RSI has entered overbought territory, signaling potential exhaustion, while the MACD is starting to tighten, which may indicate that the bullish rally is becoming overstretched. For bears to regain control, the October high at 19,783 must be retested. A break below this level could open the door to a retest of the early November high at 19,525. This area aligns closely with the 50-day SMA at 19,583, creating a critical support zone. For bulls, support is located at the 161.8% Fibonacci retracement level at 20,566, a value that has proven significant in recent trading sessions and could act as a springboard for further upward momentum. Source: xStation

News

• Munich Re (MUV2.DE) shares are in focus after the German reinsurance giant announced ambitious 2025 targets, forecasting a net profit of €6 billion. The company expects insurance revenue to reach €64 billion, with its reinsurance segment contributing €42 billion. The property-casualty reinsurance combined ratio is projected at 79%, while return on investment is expected to exceed 3%. The ERGO unit is anticipated to generate €22 billion in insurance revenue with a €0.9 billion profit contribution. The company will release its full-year 2024 results on February 26.
• Deutsche Bank (DBK.DE) is reportedly planning a leadership change in its risk management division. According to WirtschaftsWoche, former Commerzbank Chief Risk Officer Marcus Chromik is set to replace current risk head Olivier Vigneron, whose contract expires at the 2025 AGM. The bank is also experiencing changes in its private banking division, with Raoul Zehnder departing and several executives taking on expanded roles across different regions.
• Daimler Truck Financial Services, part of Daimler Truck (DTG.DE), has revealed it is owed approximately $139 million by bankrupt trucking company Kal Freight, secured by titles to 1,625 tractors and trailers. The case involves allegations of serious fraud, including double-pledging of collateral and fictitious equipment claims. Kal Freight's total debt to creditors, including Bank of America and TBK Bank, amounts to at least $325 million. The bankruptcy court has approved the appointment of independent directors as the case proceeds.

Other news coming from individual DAX index companies. Source: Bloomberg Financial LP