German shares wrapped up a hectic trading week on a downward note, with the DAX index sliding 0.10%. Market participants are gearing up for a crucial monetary policy announcement from the US Federal Reserve next week. BofA Global Research forecasts that the Fed will reduce rates by 25 basis points at its December meeting.
They anticipate that Chairman Powell will highlight a more gradual pace of future cuts, possibly introducing a pause in January during his briefing. The projection dot plot might indicate three rate cuts in 2025 along with a higher neutral rate. Analysts believe macroeconomic forecasts will suggest slightly elevated inflation for the upcoming year and greater growth in the long run. On the domestic front, Germany's trade surplus declined to 13.4 billion euros in October, down from 16.9 billion euros in September.
Data from Destatis revealed a 2.8% decrease in exports month-over-month, while imports saw a marginal decline of 0.1%. In other economic indicators, wholesale selling prices in Germany dropped by 0.6% year-over-year in November, following a 0.8% contraction in October. The Federal Statistical Office attributed this ongoing decline to falling prices in wholesale mineral oil products. In corporate highlights, Munich Re ($MUV2) emerged as the top performing stock during Friday's session, gaining 5.57%.
The German reinsurer announced plans to achieve 6 billion euros in IFRS net profit by 2025, alongside group insurance revenue estimated at 64 billion euros. Analysts at BofA remarked, "For a company which has shown historic conservatism in target-setting, this is a clear positive," and reiterated their buy recommendation for the stock. Bayer's ($BAYN) acoramidis drug received a nod for approval from a European Medicines Agency panel as a treatment for adults suffering from transthyretin amyloid cardiomyopathy, a condition that can result in heart failure.
However, Bayer's stock closed 2.06% lower..