German stocks climbed into positive territory on Thursday morning, propelling the market to new record highs in anticipation of the European Central Bank’s upcoming announcement on monetary policy later today.
Investors are evaluating corporate updates and recent data indicating an increase in Germany’s import prices for the second month in a row. Additionally, GDP data from the Eurozone is expected later today.
The ECB is anticipated to cut interest rates for the fifth consecutive session, while also hinting at further measures to stimulate growth.
On Wednesday, the Federal Reserve maintained its key interest rates, acknowledging that inflation remains "somewhat elevated" and underlining its strong commitment to returning inflation to its 2% target. Notably, the Fed omitted a previously included phrase that stated inflation had "made progress" towards this goal.
The DAX index gained 64.17 points, or 0.3%, reaching 21,687.25 recently.
Siemens Energy saw a 4% increase, while Vonovia rose by 2.3%. Siemens, HeidelbergCement, Rheinmetall, BASF, and Continental also experienced gains ranging from 1.4% to 2%.
Brenntag, MTU Aero Engines, Beiersdorf, Siemens Healthineers, Merck, Sartorius, Deutsche Post, and Daimler Truck Holding also reported significant increases.
Conversely, Deutsche Bank saw a 4.7% decline following a steep drop in its fourth-quarter earnings, with profits attributable to shareholders plummeting 92% to 106 million euros from 1.26 billion euros the previous year. Profit before tax fell to 583 million euros, a 17% decrease from the previous year, although revenues were up 8% to 7.2 billion euros, marking the highest level since 2014.
Looking ahead to fiscal 2025, Deutsche Bank reaffirmed its revenue target of approximately 32 billion euros.
Meanwhile, Symrise, Fresenius Medical Care, Commerzbank, Deutsche Telekom, RWE, and BMW saw dips ranging from 0.3% to 1%.
Destatis data released on Thursday revealed that Germany’s import prices increased for the second consecutive month in December, at the fastest rate in nearly two years.
Annual import prices rose 2%, following a 0.6% increase in November, marking the fastest import price inflation since February 2023, when prices had risen by 3.1%.
The annual price increase was largely driven by a 4.6% uptick in imported consumer goods costs, particularly food commodities. Durable goods were 2% more costly.
Month-over-month, import prices rose 0.4% after a 0.9% increase in the prior month, slightly below the expected 0.5% growth. Export price inflation accelerated to 1.8% from 1.2% the prior month. On a monthly basis, export prices increased steadily by 0.3%.
In 2024, import prices showed a 1.2% decline compared to a 6.5% decrease in 2023. On average, export prices in 2024 were 0.3% higher compared to the previous year.
