MORNING BRIEFING - Germany/Europe

DJ MORNING BRIEFING - Germany/Europe

The morning market overview, compiled by Dow Jones Newswires:

TOPIC OF THE DAY

The European Union and the United States have reached an agreement in principle to resolve the tariff dispute, as announced by EU Commission President Ursula von der Leyen and US President Donald Trump. The tariff on most EU exports to the US will be 15 percent, thus avoiding a trade war with the US's largest trading partner. Trump said the US would impose a base tariff of 15 percent on European goods, including cars. He said that under the agreement, the EU had agreed to purchase $750 billion worth of energy products from the US and invest an additional $600 billion in the US.

COMPANY OUTLOOK

07:00 FR/Essilor-Luxottica SA, Result 1H

07:00 NL/Heineken NV, Result 1H

09:00 DE/Audi AG, 1H results (08:00 PK)

DIVIDEND DISCOUNT

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

 Geratherm 0.10 EUR
Nokia 0.035 EUR

ECONOMIC OUTLOOK

No relevant economic data announced.

OVERVIEW FUTURES / INDICES

 Index last +/- %
DAX Futures 24,561.00 +0.8%
E-Mini Future S&P-500 6,452.00 +0.4%
E-Mini Future Nasdaq-100 23,552.00

+0.6%
Nikkei-225 (Tokyo) 41,038.92 -1.0%
Hang-Seng (Hongk.) 25,490.45 +0.4%
Shanghai-Comp. 3,587.69 -0.2%

Previous day:
DAX 24,217.50 -0.3%
DAX future 24,370.00 -0.1%
XDAX 24,287.07 +0.3%
MDAX 31,484.37 -0.5%
TecDAX 3,855.70 -0.2%
SDAX 17,829.48 -0.4%
Euro Stoxx 50 5,352.16 -0.1%
Stoxx 50 4,510.26 -0.4%
Dow Jones 44,901.92 +0.5%
S&P 500 6,388.64 +0.4%
Nasdaq Composite 21,108.32 +0.2%

FINANCIAL MARKETS

EUROPE

Outlook: Traders on the stock exchanges expect premiums at the start of trading. As expected, a trade deal with a 15 percent tariff has been reached between the Trump administration and the EU. This is likely to result in price increases as a result of the usual stock market reflex. Whether the gains will be sustainable in the long term remains to be seen, however. "Negotiations could not have been worse," said one trader. EU President Von der Leyen fell for all the Americans' tricks, especially the recent threat of 30 percent tariffs. As expected, they are now satisfied with 15 percent – a massive cost explosion for the economy compared to the previous situation: Before US President Donald Trump's trade war, US import tariffs were only around 2.3 percent, according to calculations by JP Morgan. According to Handelsblatt, the German economy alone will suffer losses of 6.5 billion euros.

Review: Barely held up - Some profit warnings dampened sentiment, which was, however, largely supported by hopes for an early agreement in the trade dispute between the EU and the US. LVMH gained 3.9 percent, as its figures were not quite as weak as feared. Remy Cointreau rose 8.1 percent. Organic sales growth in the first quarter, at 5.7 percent, was clearly better than the market forecast of 2.3 percent. The beverage group also raised its targets. RBC rated Eni's second-quarter figures (+1.8%) positively. The utility's net profit of €1.13 billion clearly exceeded the market forecast of €930 billion. Some targets for the current year were also raised. French supplier Valeo (-5.4%) saw sales and net profit collapse in the first half of the year. Michelin (-3.4%) confirmed its targets for the current year, although its half-year results missed expectations. Weak results pushed Signify down 12.4 percent.

DAX/MDAX/SDAX/TECDAX

A little lighter - VW lowered its estimates for the year. However, due to solid half-year figures, the shares rose by 4.6 percent, and the lowered outlook was not unexpected. BMW, Mercedes, and Porsche closed up by as much as 2.8 percent. Regardless of the quarterly figures, the sole driving force here was hope for an impending deal with the USA. Truck manufacturer Traton (-4.1%) had lowered its forecasts. Weak quarterly data and a stern profit warning caused Puma to slump by 16 percent. Adidas turned around at the end of trading, closing 0.2 percent higher. Deutsche Börse was down 1.7 percent after its second-quarter figures. JP Morgan criticized the fact that, as in the previous quarter, its Investment Management Solutions (IMS) division, which is in focus, had missed expectations.

XETRA AFTER-SALES MARKET

Trading was very quiet on Friday. Following Wall Street's lead, stocks rose slightly, driven by hopes that the US and EU would soon reach a trade agreement. Otherwise, news was thin. No notable movements in individual stocks were reported.

USA - STOCKS

Somewhat firmer – hopes for progress in resolving the tariff dispute continued to drive prices higher. The meeting between US President Donald Trump and EU Commission President Ursula von der Leyen, scheduled for Sunday, fueled expectations that both sides could soon agree on a trade agreement. The S&P 500 and Nasdaq Composite reached record highs, but again only slightly above their previous levels. Economically, new orders for durable goods fell sharply in June. However, economists had feared worse. Intel (-8.5%) widened its losses in the second quarter and decided to cut 15 percent of its workforce. The US corporation is also abandoning multi-billion euro investment plans for new chip factories in Europe. Newmont rose 6.9 percent after second-quarter figures exceeded market expectations, with the gold mining operator benefiting from the precious metal's recent record highs. The $8 billion merger of Paramount Global (-1.6%) with Skydance has received regulatory approval. Edwards Lifesciences jumped 5.5 percent after strong second-quarter results. Deckers Outdoor surged 11.4 percent, above consensus, following equally strong quarterly results.

USA - BONDS

Treasury bonds saw some gains. The ten-year yield fell 3 basis points to 4.38 percent. Investors were positioning themselves for the Fed's interest rate meeting and a plethora of important economic data in the coming week, sources said. The Fed is widely expected to leave interest rates unchanged. Observers are hoping for statements on possible rate cuts in the coming months.

FOREIGN EXCHANGE MARKET

 FOREIGN CURRENCY last +/- % 00:00 Fri, 7:50 % YTD
EUR/USD 1.1749 -0.1 1.1762 1.1745 +13.4%
EUR/JPY 173.57 -0.1 173.71 172.78 +6.3%
EUR/GBP 0.8743 -0.1 0.8752 0.8701 +5.6%
GBP/USD 1.3438 -0.0 1.3441 1.3498 +7.4%
USD/JPY 147.74 0.0 147.69 147.11 -6.1%
USD/KRW 1,383.64 0.8 1,383.64 1,379.05 -6.2%
USD/CNY 7.1481 0.1 7.1481 7.1441 -0.8%
USD/CNH 7.1690 0.1 7.1643 7.1631 -2.3%
USD/HKD 7.8491 -0.0 7.8494 7.8492 +1.0%
AUD/USD 0.6567 -0.1 0.6573 0.6578 +6.1%
NZD/USD 0.6012 -0.1 0.6017 0.6027 +7.5%
BTC/USD 119,236.85 -0.0 119,287.55 115,490.95 +24.8%

The dollar benefited from declining interest rate cut speculation, with the dollar index gaining 0.3 percent. Trump's comments on Federal Reserve Chairman Powell likely played a role here. During a visit to the U.S. Federal Reserve, the president said he was unlikely to fire Jerome Powell.

The basic agreement between the US and EU is likely to increase risk appetite, speculates Pepperstone analyst Michael Brown. However, the euro is not benefiting this morning and is falling against the US dollar. Skepticism about the agreement prevails in the trade. Many players believe Europe has come out too lightly. The agreements, which have so far only been verbally announced, are likely to cost the EU growth, so it is feared.

RAW MATERIALS

OIL

 CRUDE OIL last VT closing +/- % +/- USD % YTD
Brent/ICE 67.63 67.61 +0.0% +0.02 -9.7%

The stronger dollar put pressure on prices, which trended lower. Increased supply from Venezuela also weighed on crude oil. A barrel of US WTI light crude oil fell 1.3 percent to $65.16.

METALS

 METALS last previous day +/- % +/- USD % YTD
Gold 3,340.40 3,336.81 +0.1% +3.59 +27.2%
Silver 32.54 32.45 +0.3% +0.09 +16.6%
Platinum 1,209.89 1,195.14 +1.2% +14.75 +36.7%
Copper 5.76 5.76 0% 0.00 +42.6%
YTD based on the previous day's closing price
(Information provided without guarantee)

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July 28, 2025 01:39 ET (05:39 GMT)

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