The central banks are increasingly burdening the stock markets with their interest rate hikes to curb high inflation.
The central banks are increasingly burdening the stock markets with their interest rate hikes to curb high inflation.
On Thursday, an unexpectedly significant rate hike by the Swiss National Bank (SNB) put Europe’s already fragile stock markets under severe pressure. The slide deepened in the afternoon after US stocks started trading lower after their mid-week recovery.
In Frankfurt, the Dax dropped towards the round mark of 13,000 points and ultimately lost 3.31 percent to 13,038.49 points. The leading German index is thus at its lowest level since the beginning of March. The MDax for medium-sized stocks fell by 3.77 percent to 26,735.77 points after temporarily hitting its lowest level since November 2020.
The SNB surprisingly increased the key interest rate by 0.50 percentage points and justified this as a measure against inflationary pressure. According to one market participant, hardly any economists had expected that the Swiss National Bank would join the ranks of interest-raising central banks at this point. In addition to the SNB, the Bank of England (BoE) also raised its key interest rate by a further 0.25 percentage points to 1.25 percent on Thursday. This was expected.
The market focused on online fashion retailers following a downgraded forecast from Asos and a disappointing interim report from Boohoo. This put considerable pressure on the shares of German competitor Zalando. The papers fell at the bottom of the Dax by 12.4 percent. The 39 other index values also closed in the red.
The shares of BASF and Uniper were also among the weakest stocks, falling 6.9 and 9.7 percent respectively. The main reason is likely to be the further reduction in gas deliveries to Germany by the Russian energy group Gazprom. At BASF, for example, a possible stop in Russian gas supplies is threatening production at the Ludwigshafen chemical site.
The Eurozone leading index EuroStoxx 50 lost 2.96 percent to 3427.91 points. Paris’ Cac 40 came under slightly less pressure, while London’s FTSE 100 fell just over 3 percent. In New York, the leading barometer Dow Jones Industrial fell by 2.5 percent at the close in Europe.
The euro benefited from the weak US economic data and most recently cost 1.0513 US dollars. The ECB set the reference rate at 1.0400 (Wednesday: 1.0431) dollars. The dollar thus cost 0.9615 (0.9587) euros.
Prices on the bond market plummeted. In contrast, the current yield rose to 1.72 percent from 1.66 percent the previous day. The Rex pension index fell by 0.27 percent to 130.47 points.
