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DAX 30 Review: April 2021

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Following two consecutively strong months in February and March, Germany’s prime index took a pause in April 2021. On average the DAX 30 companies closed +0.30 % higher than in the previous month. While the good performance in the first quarter was mainly driven by a lot of optimism and hopes for a quick end of the pandemic, new curfews and extended lockdown measures in Germany knocked some investors out of the sky. Find out below which companies performed best and which did not so well.

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DAX 30 Performance (YTD April 2021)

In April 2021, the DAX index took a pause and closed about +0.30 % higher than in the previous month. Besides the top and flop 3 companies, there were some other outliers in April. Among them SAP with a strong +11 % gain in April as well as Infineon with a hefty -7 % loss on the other end of the spectrum. From an overall market perspective, all expectation point towards an upcoming end of the pandemic. As European countries are still fighting the third wave of the pandemic, the outlook remains still optimistic for 2021.

Tops and Flops of the Month

Top 3 Companies

Delivery Hero, one of the newest members in the DAX 30 and certainly a big Corona winner is best in class this months. The food delivery company closed +19.5 % higher compared to the previous month. The main driver for this performance can easily be linked towards Delivery Hero’s earnings report for the last quarter. The numbers were nothing less than impressive. For instance earnings grew by a stunning +81,15 % compared with Q1 in 2020. While many analysts are very bullish on Delivery Hero, it is still worthwhile to mention that the company is still due to report positive net income.

The condemned live longer. There is a lot of truth in that statement for Germany’s biggest financial institution and one of the former global shining stars of the industry. The financial industries sector has reported exceptionally well numbers across the globe. Earnings of banks have crushed investor expectations by a lot. Deutsche Bank was no exception to that. The Frankfurt based company reported its best quarter since 7 years. The reported net income was at about 900 Million EUR, which was significantly driven by its investment banking division. Deutsche Bank is also currently in a large business transformation and cost cutting program which also attributes to the strong bottom line income.

While Deutsche Wohnen has always shown solid performance during the first months of 2021, it never made it to the top of the list. This changed in April, however. The German real estate giant closed +13.12 % higher than in March 2021. One of the key developments in April was a verdict rendered by the German federal court, revoking the so called “Mietendeckel” (or rent-freeze legislation) in Berlin. The verdict has also signalling effect beyond Berlin as other states were considering to levy similar regulations. In fact, Deutsche Wohnen can now claim back the rent which it was not allowed to raise from its renters for previous years.

Flop 3 Companies

While Volkswagen is down by about -9 % in April of this year, the German Automotive OEM is still the DAX’ best performing company in 2021, so far (up about +42 % since January). From a news perspective, there were even some positive reports in March according to which Volkswagen has significantly raised its number of sold cars, especially in China. Other news cited the company claiming about 1 billion from its former CEO Winterkorn, following the Diesel-Gate. In general the company is also heavily affected by the current shortage in semi-conductor supplies, which is a cross-industry issue also for many technology companies at the moment.

Following the carve-out from SIEMENS, the energy company has a hard time in Germany’s prime index. From a year-to-day perspective, SIEMENS Energy is among the worst performing stocks in the DAX (down by about -7.33 %). The energy markets are overall quite volatile, as the entire sector is in the midst of a transformation to renewable and sustainable energy production and resources. While there were no specific bad news for the German energy giant, analysts remain optimistic and recommend to buy the stock.

At first it may appear quite confusing to some investors to see Munich RE down by almost -9 % in April 2021. However, there is an easy explanation. On the 29th of April, the worlds largest reinsurer distributed its dividends, which are – as always – significant and had direct impact on the stock price. Additionally, the Board of Directors was empowered to issue new shares. Thus, while the stock price went down by a lot, this had nothing to do with the core business operations. In fact, the company reported good numbers and analysts are still bullish on the stock.

DAX Chart