Germany's Dax climbs to year's high
August 9, 2016
Reflecting the positive mood among German investors, the country's blue-chip Dax climbed by roughly 0.5 percent in midday trading on the Frankfurt Stock Exchange on Tuesday.
The benchmark index reached 10,487.43 points and thus logged its highest level this year so far, beating its performance on the very first trading day in 2016 before the Dax plummeted for two months in a row.
Frankfurt traders said Tuesday's rally was first and foremost attributable to better-than-expected quarterly results by the world's largest reinsurer, Munich Re.
Bottom-line earnings: 974 million euros ($1.08 billion)
The company achieved above-average net profits despite higher natural disaster expenditure in the second quarter, with extra costs "arising from wildfires in Canada and earthquakes in Japan," Munich Re CEO Nikolaus von Bomhard said in a statement.
The reinsurer also said it had successfully withstood capital market turbulence in the wake of the UK's Brexit referendum, in part by selling off equities in the run-up to the June 23 vote.
But Munich Re warned business prospects were overshadowed by the European Central Bank and others crowding investors out of bond markets and keeping interest rates low, thus creating a challenging environment for financial firms.
hg/jd/ (AFP, dpa)