Germany’s main equity benchmark concluded its biggest two-year run in more than a decade, leaving the country’s European rivals trailing in the dust.
The DAX Index yesterday closed the year 19 percent higher to extend a rally since January last year to 43 percent. While the export-heavy gauge has lagged the S&P 500 in the US for this year, it far outpaced regional peers including the UK’s FTSE 100 and France’s CAC 40.
German markets will be closed on New Year’s Eve and Jan. 1 with trading set to continue on Thursday.
Photo: Daniel Roland, AFP
Expectations for a healthy global economy and a recovery in China have supported German stocks at a time when the local economy is facing challenges. SAP SE was the biggest contributor to this year’s continued gains as investors sought technology plays, accounting for nearly a third of the index’s rally.
A surge in excess of 300 percent for Siemens Energy AG added to the outperformance, while an increase in defense spending helped fuel Rheinmetall AG shares to more than double in value.
These strong performances helped to offset struggles in some of Germany’s core sectors.
Automotive stocks were hurt by lagging demand and the growing strength of Chinese electric-vehicle manufacturers, with the likes of Volkswagen AG, Porsche AG and BMW AG all suffering losses of 20 percent or more.
Bayer AG was the biggest loser with a 43 percent decline as the chemical maker’s struggled with its turnaround plan and legal battles.
Strategists are now expecting more muted gains in the coming year, according to a Bloomberg survey earlier this month. A key point of interest will be February’s national election, which could unlock more fiscal spending toward a fragile domestic economy.
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Taiwanese manufacturers have a chance to play a key role in the humanoid robot supply chain, Tongtai Machine and Tool Co (東台精機) chairman Yen Jui-hsiung (嚴瑞雄) said yesterday. That is because Taiwanese companies are capable of making key parts needed for humanoid robots to move, such as harmonic drives and planetary gearboxes, Yen said. This ability to produce these key elements could help Taiwanese manufacturers “become part of the US supply chain,” he added. Yen made the remarks a day after Nvidia Corp cofounder and chief executive officer Jensen Huang (黃仁勳) said his company and Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) are jointly
United Microelectronics Corp (UMC, 聯電) expects its addressable market to grow by a low single-digit percentage this year, lower than the overall foundry industry’s 15 percent expansion and the global semiconductor industry’s 10 percent growth, the contract chipmaker said yesterday after reporting the worst profit in four-and-a-half years in the fourth quarter of last year. Growth would be fueled by demand for artificial intelligence (AI) servers, a moderate recovery in consumer electronics and an increase in semiconductor content, UMC said. “UMC’s goal is to outgrow our addressable market while maintaining our structural profitability,” UMC copresident Jason Wang (王石) told an online earnings
MARKET SHIFTS: Exports to the US soared more than 120 percent to almost one quarter, while ASEAN has steadily increased to 18.5 percent on rising tech sales The proportion of Taiwan’s exports directed to China, including Hong Kong, declined by more than 12 percentage points last year compared with its peak in 2020, the Ministry of Finance said on Thursday last week. The decrease reflects the ongoing restructuring of global supply chains, driven by escalating trade tensions between Beijing and Washington. Data compiled by the ministry showed China and Hong Kong accounted for 31.7 percent of Taiwan’s total outbound sales last year, a drop of 12.2 percentage points from a high of 43.9 percent in 2020. In addition to increasing trade conflicts between China and the US, the ministry said
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