The feared change of course did not take place. The ECB, while slightly reducing the purchases of securities under the Pepp programme, has firmly maintained the course towards the recovery of the economies which, thanks to the weak euro, is proceeding at a good pace. It is the ideal setting for accompany the German economy, true engine of the Old Continent, in a delicate passage on several fronts. Politics, above all, in view of theexit of Angela Merkel with the elections of 26 September which, according to the polls (falsified even beyond the Rhine), should reward Olav Scholz, the social democrat former burgomaster of Hamburg, judged to be the ideal continuation of the SPD-CDU alliance policy which has governed the country for decades. There economic turnaround, more complicated and uncertain given the challenges that are looming for the car that is now facing the transition to electric power, but also for other sectors, especially those involved in the transition from coal to clean energy, a leap that is often more complicated and costly than how much you don't want to admit.
Last but not least comes the financial challenge. The banking model is in a by now endemic crisis: medium-sized banks are suffering, crippled by low rates; Deutsche Bank does not recover, weighed down by the many misadventures suffered in an attempt to compete with the US banking giants, nor does Commerzbank see the end of the tunnel. Attempts to lead the system towards Fintech, for now, have caused more failures than advantages, judging by the Wirecard disaster, which has deeply affected the credibility of the supervisory bodies. And finally, the news of the investigations by Bafin on the upper floors of Allianz, the flagship of Teutonic finance, in the face of some suspicious transactions to the detriment of customers, is recent. A complicated picture, therefore, but one in which the desire to bet more decisively and transparently on the stock market has matured, as the big international investors have always asked. This also explains the market revolution, which only started on 3 September last, but which is already changing the approach and choices of investors, large and small, who refer to the Dax indices.
In particular:
- Germany's main stock index was ported from 30 to 40 components, marking a significant evolution of the index and the German capital market. The 30 previous members lose some of their weight to the new members.
- Between the new entries the giant Airbus stands out, so far only dealt with in Paris. The stock alone will be worth more or less 5% of the market, as much as Daimler or Allianz.
- Also joining the Dax are chemicals retailer Brenntag, kitchen box supplier Hellofresh, holding company Porsche, pharmaceutical and laboratory supplier Sartorius, medical technology group Siemens Healthineers, flavors and fragrances maker Symrise, and retailer fashion trends Zalando. The picture is completed by Puma and the biotech Qiagen.
- The hegemony of mechanics and chemistry is partially removed a advantage of technology (so far represented only by Sap and Infineon) and the biomedical sector.
- In parallel drops from 60 to 50 members the number of members of the MDAX list of medium-sized companies which includes, among other things, the online pet food retailer Zooplus, which has just been taken over by an American private individual.
- The first consequence of the reform was that of strengthen the size of the German square reducing the gap from the Paris Stock Exchange: in fact, freshmen are worth a total of 350 billion euros which are added to the 1.400 billion of the previous year, against the 2.200 billion value of the French market. These numbers give the measure of reduced weight of Piazza Affari, controlled by Euronext, which is struggling to reach 700 billion in value, despite the growing interest in SMEs shown by the number of Aim freshmen which now has more than 160 companies.
Beyond the dimensions, however, the value of the reform lies in the qualities required of the participants:
DAX candidates must have positive EBITDA in the last two years of annual financial statements.
Financial reporting obligations have been introduced with specific penalties for non-compliance. It will no longer be possible for a security to remain listed for more than a month after the start of the judicial investigations, as happened for Wirecard.
Adherence to certain provisions relating to audit committees in the German Corporate Governance Code is required.
Le index revisions they become two a year: the one in March is added to the traditional one in September.
A single parameter ranking by market capitalization is introduced.
The minimum liquidity requirement also applies.
A set of reforms that bring Frankfurt closer to the standards of other markets, a circumstance that could accelerate the creation of a single large European capital market, a need that is increasingly felt after the loss, via Brexit, of the City window.
