German equities remained relatively stable as market analysts focus on the final inflation figures coming from the eurozone's largest economy, which play a pivotal role in shaping the European Central Bank's monetary policy decision scheduled for this week. At the close of Tuesday's trading session, the blue-chip DAX index fell slightly by 0.08%.
The annual inflation rate in Germany was confirmed at 2.2% for November, an increase from 2% in October. The harmonized inflation rate matched expectations, coming in at 2.4% year-over-year. Destatis indicated that heightened price increases in services were a crucial factor contributing to the final reading. BofA Research predicted, "We expect the ECB to cut all three policy rates by 25bp this week.
We don't think larger cuts are on the table. Instead, we think the wording on the path from here for policy rates is likely to be changed. We expect a signal that the level of restriction will continue to be reduced in future meetings without pre-committing to a particular path or back-to-back cuts, emphasizing that decisions will be data-dependent and taken meeting-by-meeting." On the corporate front, Allianz ($ALV) experienced a slight drop of 0.17% after revealing its financial targets for the period of 2024 to 2027 during its Capital Markets Day presentation.
The German insurer has set an ambitious goal of achieving a compound annual growth rate in its earnings per share (EPS) somewhere between 7% to 9% over the specified period. BofA analysts commented, "Allianz's capital markets day strengthens confidence in its balance sheet and well-diversified operations, though is unlikely to materially affect earnings and cash generation forecasts, we believe." In another notable development, Delivery Hero's ($DHER) Talabat unit officially made its debut on the Dubai Financial Market after securing 7.5 billion Emirati dirhams through its initial public offering, marking a significant milestone as the largest IPO in the GCC region for 2024.
However, the German delivery platform saw its stock plunge by 11.94%..