Racing Webs Out of Competition - Rheinmetall Stocks Skyrocket
The U.S. Federal Reserve is expected to maintain its current interest rates at the upcoming meeting, with the federal funds rate likely to be held at 4.25–4.50%. However, there is growing speculation for a rate cut in September 2025, driven by weaker-than-expected U.S. job and manufacturing data. These indicators have increased market odds for a rate cut to over 75%, with some Fed members advocating a 0.25% cut and a dovish tone prevailing among policymakers.
In the German economy, the end of the traffic light coalition has raised hopes for fiscal support. Carsten Mumm from Donner & Reuschel bank sees this as an opportunity for an "economic and political restart."
Meanwhile, in the German DAX index, Rheinmetall's exceptional performance is largely linked to sectoral shifts favoring defense and industry stocks within European markets. The defense and industrial player has benefited from strengthened demand and investment in defense across Europe, resulting in a current eight percent gain in its stock. This positive performance aligns with the performance of other defense stocks, such as Digital Stars Europe Acc, which has overweighted defense and industry sectors.
Other notable performers in the DAX include Heidelberg Materials, which gained 5.7 percent due to investors welcoming the construction materials company's optimistic outlook for the year. Daimler Truck, another DAX heavyweight, rose 5.8 percent following analyst Daniela Costa of Goldman Sachs' praise for the truck manufacturer's profitability.
However, not all stocks in the DAX are performing equally well. Fresenius is currently the laggard in the index, with a loss of 1.7 percent. This loss may be due to profit-taking, as the stock gained significantly the day before.
CEO Armin Papperger of Rheinmetall stated that the company is experiencing growth that it has never seen before. However, delays in order intake are clouding the picture for Rheinmetall. Sandra Rhouma, an analyst at investment firm AllianceBernstein, wrote that the early federal elections have raised hopes for more fiscal support for the economy.
[1] Fed Funds Rate Forecast: July 2023 Meeting [2] Defense Stocks Soar Amid European Defense Boom [3] U.S. Job Growth Slows, Unemployment Rises [4] Rheinmetall's Q2 Results: A Look at the Numbers [5] DAX Index: A Closer Look at the Current Market Trends
- Following the U.S. Federal Reserve's potential interest rate cut in September 2025, there's a growing interest in understanding the impact on [finance, investing, business, general-news].
- Amid the German economy's anticipated fiscal support and the European defense boom, defense and industrial stocks such as Rheinmetall and Digital Stars Europe Acc are experiencing significant growth in [technology, business, finance, general-news].
- With weaker-than-expected U.S. job and manufacturing data, politicians and policymakers are carefully monitoring [politics, economy, business, general-news] and considering the potential implications for future interest rates.
