German equities commenced the new trading week on a negative note as investors prepare for the potential ramifications of the most recent US jobs data on the Federal Reserve's monetary policy decisions. On a relatively quiet day in terms of local economic news, the blue-chip DAX index closed 0.41% lower. The jobs report for December was exceptionally strong, revealing an increase in payrolls by 256,000, with the unemployment rate decreasing by a tenth to 4.1%.
Analyzing the resilient labor market, many analysts suggest that the Fed's cutting cycle may have come to an end. Despite this strong performance, inflation is still above the target range. In the December Summary of Economic Projections (SEP), the Fed significantly upgraded its base case forecast for 2025 and pointed out that inflation risks appear to be skewed upwards.
Furthermore, economic activity remains robust, leading experts to believe that there is little reason for any additional easing of monetary policy. Looking at the domestic front, the economic data schedule for the week includes the release of the latest wholesale price report as well as final inflation figures for December 2024.
Regarding the broader eurozone, the upcoming release of the November 2024 industrial production data is set for Wednesday, which will be followed by the trade balance figures on Thursday. The week will wrap up with the final inflation print for December 2024 on Friday. On the corporate front, BMW witnessed a decline of 0.21% on Xetra after announcing that it had recorded nearly 2.5 million sales in 2024, reflecting a 4% year-over-year drop.
Among these sales, 426,594 were fully electric vehicles, which saw a notable increase of 13.5% compared to the previous year. Management board member Jochen Goller commented, "The BMW Group is maintaining its growth trajectory for fully-electric vehicles amid challenging market conditions. We are confident we can sustain our BEV sales growth in 2025 with our strong and expanded product line-up." Additionally, Bayer, along with its BlueRock Therapeutics unit, is planning to initiate a late-stage study of their Parkinson's disease cell therapy bemdaneprocel in the first half of the year.
The results from this study are expected to support regulatory applications for the drug under investigation. Bayer's stock appreciated by 0.27% at closing, reflecting investor optimism regarding their advancements in therapeutic development..