Market Developments
This week, important developments in the financial markets and economy that are relevant for investors were highlighted. A focus was placed on stock indices and the macroeconomic conditions.
Stock Markets and Macroeconomic Conditions
The current market commentary from BlackRock indicates that broad stock benchmarks are showing cautious tendencies at present. However, strong sell-offs provide opportunities for targeted security selection. Political shifts in the US are leading to an increase in government spending worldwide, while in Europe, the German investment package for defense and infrastructure worth one trillion euros opens up new opportunities in the defense sector. However, sustainable outperformance of European stocks is currently rather unlikely due to growth and profit expectations.
Interest Rate Trends and Inflation
New US tariffs and their global reactions support expectations that interest rates, especially for long-term bonds, will remain higher than before the pandemic. This situation could ignite inflation, as tariffs and looser fiscal policies worldwide lead to higher prices. Core inflation in the US is already above the Federal Reserve’s 2% target, which makes the prospect of interest rate cuts look critical.
Economic Environment
Companies are increasingly pessimistic about the year 2025, given rising recession risks. The German labor market is showing a new trend with declining employment numbers for the second consecutive quarter, while business formations have increased by 11.4%, indicating optimism despite difficult conditions.
Corporate News
The number of employed people fell in the first quarter, while about 36,500 new businesses were founded, indicating a dynamic startup scene.
These developments provide investors with an overview of the current market situation: Despite macroeconomic risks such as inflation and recession fears, political investment programs and market volatility open up investment opportunities. Specialized analyses such as the BDEW electricity price analysis or reports on the photovoltaic market provide additional insights into specific industries.