German Stocks Rebound as Fuel Costs Concern Subsides
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German stocks are on a five-day winning streak as concerns that higher fuel costs might cut airlines’ and automotive companies’ earnings subside.
Photo Credit: Petrick2008
In a span of four weeks airlines company Deutsche Lufthansa AG posted sizeable earnings as crude oil prices stayed low this week. Tiremaker company Continental AG, which also took advantage of the low oil costs, posted gains this week.
Deutsche Postbank AG has been winning the most in two months. This winning streak started following speculations that parent company Deutsche Post will be selling the subsidiary for about 12 billion euros ($18.6 billion).
There was an added 41.76 to the benchmark DAX Index, which translates to about 0.6 percent, to 7,096.79. Climbing for two months in a row, the measure gained 2.1 percent. DAX futures that are bound to expire in June were able to gain 0.4 percent to 7,109.5. Germany’s 110 biggest companies gained in the HDAX Index about 0.7 percent to 3,641.95.
Crude oil intended for July is expected to decline after a showing that US consumption declined compared to the same period the previous year. There was a huge drop in July delivery contracts by 3.4 percent to $126.62 per barrel.
“Oil had reached clearly painful levels and such a distinct drop comes in handy, showing how much speculation is included in the price. This should have a supporting impact,” said equities head Karsten Stroh, JPMorgan Asset Management.
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