The General stock crisis defy: Software companies could claim

hopes for a comprehensive package of measures the US government were disappointed, share indices plunge, and the DAX is traded for the ten percent cheaper than

hopes for a comprehensive package of measures the US government were disappointed, share indices plunge, and the DAX is traded for the ten percent cheaper than the average of the last 15 years.

trump's measures disappoint the market

The hopes for a comprehensive package of measures the US government to combat the economic Flew of the Coronavirus have been disappointed. US President, Donald Trump repeated in the night from Wednesday to Thursday, only his claim to the Congress, the payroll tax, to suspend, to bring support for small businesses, as well as a sick money for Infected to provide. It is expected that the catalogue of ideas of the US-President will not receive the necessary approval in Congress. Because the Democrats want to bring to their own measures to the house of representatives and to make sense to the other the favor of the hour, Trump in the run-up to the presidential elections of 2020, the leg. Apparently with success: The prediction market, the probability for an electoral victory, Donald trump has fallen since the end of February of almost 60 percent to 49 percent.

The Democrats were able to increase your chances, however, from 44 to 53 percent. So the market will have to probably wait even longer to have extensive support from the policy. Not least because the Congress will make next week's holiday.

ECB can calm the Sell-off brakes

As before, the Fed and the Bank of England, the ECB was in the markets with its package of measures against the consequences of the Coronavirus pandemic. Immediately after the announcement, the DAX, EURO STOXX 50 & co. went to new daily lows before they recorded after re-trading suspension on Wall Street even losses in the double-digit percentage range. The ECB had met with improved terms and conditions of the refinancing facilities for commercial banks, as well as an additional programme to promote lending to the real economy – lofty market expectations. Added to this was the increase of 20 billion per month comprehensive bond purchase programme to a total of 120 billion euros up to the end of the year. One of many observers expected a reduction of the Deposit rate, however, remained. The requirement of ECB President Christine Lagarde, according to an "ambitious fiscal response" to the crisis, I can only join in – for a calming of the markets, this is likely to be essential.

valuations after the Sell-off

The Sell-off of the current week, the stock exchanges, a real bummer. The positive side effect: cheaper rates for those who have been waiting for an entry opportunity. The valuation levels are significantly decreased. Measured on a price-earnings ratio (p / e) are traded in the DAX and the STOXX 600 is now about ten percent less than the average of the last 15 years. The Japanese TOPIX the discount is 23 percent. And also the p / e ratio of the S&P 500 is 15.5 back to average level.

The ratings should increase in the coming weeks, however, because analysts, due to the Coronavirus pandemic will lower their profit estimates further. Currently, the markets are pricing in a profit drop in the current year. Accordingly, I expect to be given the company and analysts opaque situation continues to be increased volatility in the stock markets.

a software company as a "Hiding Place"?

European software companies are characterized by a particularly high and stable margins and a low level of Schooling. In addition, around 60 percent of their sales are less dependent on economic cycles, since many companies are offering now license subscriptions, which generate a continuous cash flow. Because of these defensive characteristics of Software could share in variation in strong market phases – I expect for the next few weeks – develop better than the overall market.

Not least because the Coronavirus in most of the cases, the chains have only a minor impact on the added value of the software company. The price-to-earnings ratio (p / e) of the sector has fallen in the Sell-off from 27 to about 23, the p / e ratio for the STOXX 600 is 12. The surcharge seems to me, however, because of the better income prospects justified. For the software sector, analysts predict in the coming twelve months, 20 percentage points more profit growth than the overall market.

the number of the day: 0,5

solar power plants are climate-friendly, but have an obvious drawback: When it is dark, they do not generate energy. Aaswath Raman of the University of California is looking for an Alternative – he's gaining power from the different rates of cooling of the top and bottom of a box. Under good conditions be a Generator to generate in the night, around 0.5 watts per square meter. It's not much, but a sufficient area could be so loaded after all, a cell phone or a lamp to be brought to light.

I wish you a high-energy day.


Ulrich Stephan

chief investment strategist for Private and corporate customers

With the stock recommendations of the Bernecker exchange-compass, you can get more out of your money! (Partner activity) 30 days free to try! Stock markets crash due to Coronavirus: Three mistakes may investors make now FOCUS Online stock markets plunge due to Coronavirus: Three errors may not make investors now


Date Of Update: 10 May 2022, 16:18

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