Markets

Dax ends turbulent year below record high

D.he Dax fell slightly in shortened trading on Wednesday at the end of a turbulent year on the stock market. The German standard value index closed on Wednesday in a quiet business 0.3 percent lower with 13,718.78 points. On Monday the index had just reached a new high, but then already weakened a little on Tuesday. The small cap indices MDax and S-Dax also closed on Wednesday below the highs they reached on Tuesday.

The highs, however, mislead about the actual development on the stock market. Since the Dax indices, as so-called performance indices, simulate a reinvestment of dividends, they, in contrast to all other common stock indices internationally, include distributions in the prices.

The FAZ index, which with 100 values ​​broadly replicates the German stock market, which does not do this, on the other hand, at 2431.67 points, is not only below its high for the year from February of 2515 points, but also below its all-time high from January 2018 of 2567 points . The Dax price index is also below its annual high and the 2018 all-time high at 5,935.22 points.

Measured at the end of 2019 of 13,249.01 points, the Dax (performance index) posted an annual plus of 3.5 percent, the M-Dax of 8.8 and the S-Dax of 18 percent, despite the corona crash in the meantime. The F.A.Z.-index, on the other hand, posted a minus of 0.3 percent, the Dax price index a plus of 0.4 percent.

The latest price gains are attributed to improved sentiment due to the Brexit agreement concluded at the last second and the adoption of the American economic stimulus package, as well as expectations of normalization thanks to vaccines against the coronavirus. However, since all these factors have long been priced in, thin trade and the self-fulfilling prophecy of a good year-end business are not to be neglected as causes. Anyone who trades stocks now is acting out of conviction.

In 2020, like everywhere else, the “corona pandemic” also shaped the stock market year. The sharp price losses at the beginning of the year began on Rose Monday, February 24th. The steep descent did not end until a good three weeks later, on March 16, at 8255 points.

Delivery Hero shares had the best performance over the year, with a gain of around 80 percent in the Dax. The delivery service is considered to have benefited from the crisis, and the upcoming inclusion in the Dax gave the share price a boost.

The biggest losers were Bayer with a loss of around a third. The share price even fell below the low of the Corona crisis in October. The pharmaceutical and agrochemical company was unable to fully settle the legal dispute over alleged cancer risks of weed killers containing glyphosate. In addition, CEO Werner Baumann had to lower the outlook for the year because of the corona crisis, which is partly affecting the pharmaceutical business, as hospitals refrained from urgently needed treatments. Baumann also prepared investors for massive headwinds in the agricultural business.

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