The German DAX index continued its downward trend on Monday, remaining in negative territory following a muted opening. By midday, the index was calculated at approximately 23,490 points, representing a decline of 0.6 percent compared to the previous trading day.
Automotive stocks were particularly affected, with some experiencing significant losses. Volkswagen shares, for instance, saw a drop of approximately eight percent. Market analysts attributed the downturn to stronger-than-anticipated profit warnings released by both Volkswagen and Porsche.
Initially, the start of the trading week appeared relatively subdued. However, investor sentiment shifted sharply as the details of the profit warnings became clearer. “The market had anticipated a period of stabilization and a trough formation within the European automotive sector, driven by restructuring and transformation initiatives” explained market expert Andreas Lipkow. “The scope of the restructuring measures at Porsche and their impact on the parent company Volkswagen, are now challenging those expectations.
The precise scale of the restructuring costs and their operational repercussions remain to be seen.
The euro strengthened against the US dollar, trading at $1.1784, with a dollar equivalent to €0.8486 at midday.
Meanwhile, oil prices decreased. A barrel of Brent crude was trading at $66.45, a reduction of 23 cents, or 0.3 percent, compared to the close of the previous trading day.
