Stocks in the DAX index significantly drop - significant contributors include BASF, Heidelberg Materials, and MTU
The German DAX index undergoes a substantial dip today, marking a reversal after an extended rally. The index currently stands at 22,466 points, down 1.7 percent from the previous day. The EuroStoxx 50 is also experiencing losses, trading at 5,462 points, down 1.3 percent.
Investors might have cashed out temporarily due to rising inflation concerns and hints from ECB Executive Board member Isabel Schnabel about a possible end to the easing cycle, according to market strategist Salah-Eddine Bouhmidi of broker IG. Additionally, the US markets did not provide any boost, as expectations there were also subdued.
The DAX has already set 19 records this year and still maintains a gain of 13.4 percent. Previously, hopes for a resolution to the Ukraine conflict and economic reforms following the federal election on Sunday had provided momentum. However, political risks have been largely disregarded, warned the chart experts at Index-Radar. Potential complexities in German government formation and announced new US tariffs for early April could pose challenges.
Among the DAX components, Heidelberg Materials, BASF, and MTU have been particularly affected. No stock is currently able to gain more than one percent, and these companies are suffering the brunt of the losses. Heidelberg Materials has seen a 5.8 percent drop, BASF a 5 percent decrease, and MTU a 4.7 percent loss.
Heidelberg Materials' shares have fallen 5.8 percent following a downgrade by US bank Morgan Stanley. Analyst Cedar Ekblom, who wrote the latest analysis, suggested that Ukraine could almost entirely supply itself from its own production, reducing the need for imports from Europe or Eastern Europe.
BASF's decline is likely due to profit-taking, with Deutsche Bank Research maintaining a "Buy" rating for the company and a price target of 55 euros. The sale of the Brazilian business with building paints brought in significantly more proceeds than expected.
MTU's stocks have suffered due to profit-taking, despite strong 2021 results. Investors may have been spooked by cash inflows falling short of expectations.
References made in the enrichment data, while providing insights into the performance of these stocks around May 2025, do not provide explicit context for the significant dip mentioned in the original article. The fluctuations in the DAX and specific stocks can be influenced by a variety of factors, including economic news, global events, and company-specific announcements.
The industry-wide sell-off might be due to investor concerns in the finance sector, as rising inflation and potential changes in monetary policy by the ECB could impact business strategies. Furthermore, the losses in the DAX could be exacerbated by specific challenges for companies like Heidelberg Materials, BASF, and MTU, shown by their significant drops in share prices.
