DE40: DAX gains 0.15% approaching 19,000 points 📌

• The German index slightly gains
• The euro weakens in anticipation of the June rate cut
• The dollar weakens ahead of the CPI report release
• Indices in Europe are having a mixed session

Midweek volatility in global markets is limited as investors await the US CPI report today at 2:30 PM. Before the report's release, markets are showing slightly better sentiment. Investors are expecting a year-over-year inflation drop to 3.4% and core inflation to 3.6%. As a result, we are seeing significant declines in the dollar and bond yields and relatively better sentiment in the stock markets.

Along with the dollar, the euro is also losing ground. The declines are supported by the increasing likelihood of an ECB rate cut in June. In today's interview, Bank of France President Francois Villeroy de Galhau confirmed this stance, noting that future steps will depend on incoming data. Additionally, Villeroy highlighted that the French economy is strong and expects a recovery next year.

DAX

The German index starts today's session with positive sentiment. At the time of publication, gains range from 0.15% to 0.20%, with bulls trying to approach the 19,000-point level. At current levels, only 0.20% is missing to reach the historical all-time high of 18,970 points.

Source: xStation 5

Company News

BMW (BMW.DE) CEO Oliver Zipse has expressed concerns that the European auto industry's value chain could halve due to the EU's plan to ban combustion-engine vehicle sales by 2035, significantly impacting jobs. He criticized the regulation as "naive," arguing it would harm competitiveness, green goals, and job security. Zipse suggested the 2026 review of EV regulations should introduce more flexible rules, focusing on incentivizing low-carbon fuels for existing vehicles and gradually reducing CO2 emission levels for new fleets annually. He also warned that the policy would increase Europe's dependence on China due to its dominance in the battery supply chain, making political calls to decouple from China impractical.

Commerzbank (CBK.DE) gains over 5.00% after the earning results. The company raised its lending income outlook for this year following its best quarterly profit in over a decade. The German bank reported a net income of €747 million for the first quarter, surpassing analyst expectations of €656 million, driven by higher interest rates and an improving German economy. CEO Manfred Knof is leveraging increased interest income to boost profits and investor payouts while focusing on strengthening fee-generating services. The bank expects 2024 net interest income to be around €8.1 billion, with first-quarter net interest income rising 9% to €2.13 billion.

Source: xStation 5

E.On (EOAN.DE) gains 0.60% after the company reported first-quarter adjusted EBITDA of €2.75 billion, exceeding the average analyst estimate of €2.69 billion and marking a 1.1% year-over-year increase. The company's adjusted EBIT was €2.01 billion, down 1.5% year-over-year but significantly above the estimate of €1.26 billion. Sales dropped by 33% year-over-year to €22.64 billion. Adjusted net income rose 1.6% to €1.05 billion, surpassing the €1.01 billion estimate.

Source: xStation 5

Zalando (ZAL.DE) co-founder David Schneider is stepping down from his co-CEO role and will be succeeded by Chief Operating Officer David Schröder. Co-founder Robert Gentz will remain as co-CEO, concentrating on expanding Zalando's B2C growth. Schneider will shift his focus to building partner relationships across Zalando’s B2C and B2B sectors and enhancing the Zalando brand.

Brenntag (BNR.DE) shares fell by 1.0% after the German chemicals distribution company missed first-quarter estimates due to pricing pressures and subsequently reduced its full-year guidance to the lower end of its range. Analysts from Morgan Stanley expect further consensus downgrades, noting that Brenntag's revenue, gross profit, and EBITDA figures were below expectations, particularly in the specialties and essentials divisions. Brenntag's first-quarter operating EBITDA was €259.7 million, below the estimated €280.2 million, with total sales of €4.00 billion, missing the forecasted €4.26 billion.