MORNING BRIEFING - Germany/Europe -2-

DJ MORNING BRIEFING - Germany/Europe

The morning market overview, compiled by Dow Jones Newswires.

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HOLIDAY NOTICE

FRIDAY: The stock exchanges in Helsinki and Stockholm remain closed for Midsummer.

TOPIC OF THE DAY

US President Donald Trump plans to decide within the next two weeks whether the US will participate in Israel's attacks on Iran. He cited the "considerable opportunity" for negotiations with Iran as the reason for the deliberation period. According to Trump's spokeswoman Karoline Leavitt, the president made it clear that he always strives for diplomacy. However, he is not afraid to show strength. Trump had previously responded to a Wall Street Journal report. "The Wall Street Journal has no idea what my thoughts are regarding Iran," he wrote on his Truth Social platform. The WSJ had reported that Trump had approved plans to attack Iran but was waiting to see whether Iran would abandon its nuclear program before issuing the final order. The report cited three people familiar with the matter.

COMPANY OUTLOOK

No important company events announced.

DIVIDEND DISCOUNT

(for German stocks and stocks from the Stoxx or Euro Stoxx 50 index)

 Company Dividend
Befesa 0.64 EUR

ECONOMIC OUTLOOK

 - DE
08:00 Producer prices May
 FORECAST: -0.2% yoy/-1.1% yoy
previously: -0.6% y-o-y/-0.9% y-o-y

- FR
08:45 Business Climate Index June
FORECAST: 96
previously: 97

- EU
16:00 Eurozone Consumer Confidence Index (flash estimate) June
FORECAST: -14.5
previously: -15.2

- US
 2:30 p.m. Philadelphia Fed Index June
FORECAST: -2.0
previously: -4.0

16:00 Index of leading indicators May
FORECAST: -0.1% y/y
previously: -1.0% y-o-y

OVERVIEW FUTURES / INDICES

 Current:
Index last +/- %
DAX Futures 23,357.00 +0.7%
E-Mini Future S&P 500 5,971.75 -0.2%
E-Mini Future Nasdaq-100 21,694.50 -0.1%
Nikkei-225 (Tokyo) 38,500.05 +0.0%
Hang-Seng (Hongk.) 23,457.16 +0.9%
Shanghai-Comp. 3,366.75 +0.1%

Thursday:
DAX 23,057.38 -1.1%
DAX future 23,054.00 -1.3%
XDAX 23,054.66 -0.0%
MDAX 29,120.07 -1.9%
TecDAX 3,733.67 -0.9%
SDAX 16,461.52 -1.3%
Euro Stoxx 50 5,197.03 -1.3%
Stoxx 50 4,438.34 -0.7%
Dow Jones 42,171.66 -0.1% (June 18)
S&P 500 5,980.87 -0.0% (June 18)
Nasdaq Composite 19,546.27 +0.1% (June 18)

FINANCIAL MARKETS

EUROPE

Outlook: Europe's stock markets are expected to start on a recovering note. Signs of detente in the Middle East conflict are providing support. An immediate US military strike against Iran appears to be off the table for now. The White House announced that US President Donald Trump will decide on possible military intervention in the next two weeks. At the same time, it was stated that talks with Iran could take place in the near future. A meeting between Iran and Great Britain, France, and Germany is scheduled for this Friday in Geneva. "The new US time horizon of two weeks is allowing the stock markets to breathe a sigh of relief," commented QC Partners. The chances for a diplomatic solution have thus increased slightly. However, the US military strike, feared by many, remains a possibility. The DAX closed nine of the past ten trading days in the red. "This impressively demonstrates how great the fear of further escalation is on the stock market," said QC Partners.

Review: Weaker - Fears of US military intervention in the conflict between Israel and Iran weighed on the stock market. According to media reports, the US is preparing a possible military strike against Iran, possibly this weekend. In the wake of rising oil prices, oil and gas stocks improved by an average of 0.7 percent. The weakest sector was travel stocks, with an average loss of 2.4 percent, followed by consumer goods, which fell an average of 2 percent. Following a drastic decline in Swiss watch exports in May, Richemont and Swatch fell by 2.7 and 2.1 percent, respectively. According to an agency report, spirits maker Pernod Ricard is streamlining its business and plans to group its brands into two main divisions. This did not help the stock, which fell 0.7 percent in Paris. UBS fell 1 percent. The Swiss National Bank supports the government's planned stricter capital requirements for the major bank.

DAX/MDAX/SDAX/TECDAX

Weaker - In the DAX, MTU (+0.1%) defied the overall negative trend. The engine manufacturer reported receiving a record number of orders at the Paris Air Show. A buy recommendation from Deutsche Bank also provided support. Deutsche Euroshop gained 9 percent. The company plans to pay a higher dividend than previously announced. Medios posted premiums of 7.3 percent to €12.10. The company has submitted a public buyback offer for up to 1 million shares. The offer price is €12.50 per share.

XETRA AFTER-SALES MARKET

No noticeable movements in individual values ​​were recorded.

USA - STOCKS (Wednesday, June 18)

Barely changed - The US Federal Reserve's interest rate decision brought no surprises and provided no stimulus to the market. As expected, the Fed kept the key interest rate stable and left the door open for further interest rate cuts in the second half of the year. However, the monetary authorities lowered their growth forecast and pointed to the increased risk of inflation that could arise from the US government's tariff policy and the Middle East conflict. Meanwhile, the Middle East war presented a mixed picture for the stock market. Although US President Trump toughened his tone towards Iran, he left it unclear whether the US would enter the war. This caused overall caution. Hasbro closed 0.6 percent higher. The toy manufacturer is cutting 3 percent of its global workforce. Circle Internet jumped 33 percent. The stablecoin company could benefit from regulatory easing, it was reported.

USA - BONDS (Wednesday, June 18)

Yields rose again after an initial decline and closed little changed after the US Federal Reserve acted in line with market expectations with its interest rate decision and accompanying statements. The ten-year US Treasury note was last at 4.39 percent.

FOREIGN EXCHANGE MARKET

 last +/- % 0:00 Previous day Thu, 17:20 % YTD
EUR/USD 1.1526 +0.3% 1.1494 1.1469 +10.8%
EUR/JPY 167.66 +0.3% 167.21 167.05 +2.2%
EUR/CHF 0.9401 +0.2% 0.9386 0.9391 +0.1%
EUR/GBP 0.8541 +0.0% 0.8537 0.8540 +3.3%
USD/JPY 145.46 -0.0% 145.46 145.66 -7.7%
GBP/USD 1.3495 +0.2% 1.3464 1.3430 +7.3%
USD/CNY 7.1693 -0.0% 7.1715 7.1792 -0.4%
USD/CNH 7.1818 -0.1% 7.1860 7.1912 -1.9%
AUS/USD 0.6489 +0.2% 0.6477 0.6456 +5.2%
Bitcoin/USD 104,522.65 +0.1% 104,367.00 104,363.65 +10.9%
YTD based on the previous day's closing price

News regarding the Middle East conflict gave the dollar some support on Thursday. The pound sterling weakened only temporarily after the Bank of England (BoE) left its key interest rate unchanged at 4.25 percent, as expected, but three of the nine members of the Monetary Policy Committee favored a 25 basis point rate cut.

RAW MATERIALS

OIL

 last VT closing +/- % +/- USD % YTD
WTI/Nymex 74.10 75.52 -1.9% -1.42 +5.0%
Brent/ICE 77.32 78.74 -1.8% -1.42 +5.2%
YTD based on the previous day's closing price

Oil prices rose in response to news that US President Trump had reportedly approved plans to attack Iran but was holding off on issuing the final order to use the missiles. Brent and WTI crude prices rose by more than 2 percent. Trump wants to wait and see whether the government in Tehran is willing to abandon its nuclear program, people familiar with the discussions said.

METALS

 last previous day +/- % +/- USD % YTD
Gold 3,347.19 3,370.68 -0.7% -23.49 +28.3%
Silver 30.91 31.73 -2.6% -0.82 +14.5%
Platinum 1,115.76 1,127.24 -1.0% -11.48 +31.8%
Copper 4.77 4.81 -0.7% -0.04 +18.3%
YTD based on the previous day's closing price

The price of gold was little changed on Thursday, partly dampened by the slightly rising dollar. However, Michael Brown of Pepperstone sees short-term upside potential for the precious metal as investors are likely to increasingly hedge against risks ahead of the weekend.

REPORTS SINCE THURSDAY 5:30 PM

CHINA - Rare Earths

(MORE TO FOLLOW) Dow Jones Newswires

June 20, 2025 01:54 ET (05:54 GMT)

DJ MORNING BRIEFING - Germany/Europe -2-

China's export restrictions on rare earth magnets took effect in May. Total exports plummeted 74 percent year-on-year, according to a Wall Street Journal analysis of Chinese customs data.

CHINA - Monetary policy

The People's Bank of China (PBoC) kept its 1- and 5-year benchmark lending rates (LPR) for businesses and households stable in June. The decision was also expected.

JAPAN - Inflation

Japanese core inflation was 3.7 percent higher year-on-year in May, up from 3.5 percent in April. Economists had expected 3.6 percent.

THYSSENKRUPP NUCERA

acquires key technologies from the Danish company Green Hydrogen Systems, which specializes in high-pressure electrolysis. The acquisition includes intellectual property and a test center with a functional prototype at the Skive site in Denmark. The purchase price was not disclosed.

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DJG/cln/gos

(END) Dow Jones Newswires

June 20, 2025 01:54 ET (05:54 GMT)

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