Hedge fund imbalances cloud the mood on the stock market

Bank share prices collapse because of severe problems with a hedge fund. The German benchmark index falls below its record level reached in the morning. However, an expert sees an overall positive mood.

Prices at a glance: display board in the Frankfurt stock exchange floor

Dhe Dax lost momentum on Monday after reaching a record high. After the German benchmark index had soared to a record high of almost 14,835 points in early trading, around noon there was only an increase of just under 0.2 percent to 14,774 points. Significant losses in the shares of Deutsche Bank clouded the positive picture.

The last time there was a tailwind from the United States. President Joe Biden’s promise of an even faster vaccination of the population is exactly what many investors wanted to hear, commented Jochen Stanzl from trading house CMC Marktes.

Meanwhile, the corona situation in Germany remains tense. The M-Dax of the medium-sized values ​​was minimally in the red to 31,573 points. For the leading Eurozone index Euro Stoxx 50 it went up by 0.2 percent.

Hedge fund imbalances are causing bank stocks to crash

Bank stocks came under particular pressure. In Zurich, the Credit Suisse shares buckled by almost 14 percent. According to its own statements, the Swiss bank is preparing for major losses due to financial problems with an American hedge fund. Last week, the fund failed to meet the margin requirements of Credit Suisse and some other banks.

DT. BANK

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  • 1T
  • 1W
  • 3M
  • 1J
  • 3J
  • 5J

To the detailed view

The Swiss bank did not provide any information about which fund it was. In Frankfurt, the shares of Deutsche Bank lost around 5 percent as the clear bottom in the Dax. At the end of the M-Dax, Commerzbank’s paper fell by almost 2 percent.

Apart from that, the general mood remains positive, said investment strategist Michael Hewson from brokerage firm CMC Markets. “The market sees the glass as half full.” Investors are counting on a surge in growth at important trading partners America thanks to the economic aid planned there, said market analyst Milan Cutkovic from the brokerage house Axi. “Further measures are expected, including increased investments in American infrastructure.”

However, the oil price fell. As concerns about a supply bottleneck caused by the temporary blockade of the Suez Canal declined, the Brent variety from the North Sea fell 0.4 percent to $ 64.28 per barrel (159 liters). “But one must not forget that it will take some time for the congestion on the Suez Canal to clear,” said Naeem Aslam, chief market analyst at the brokerage firm AvaTrade. The waterway is one of the world’s most important trade routes.