Major question marks at Varta, high expectations for Nel ASA, doubts about BYD and risks at Lufthansa.

Uncertainty causes stock prices to fall

In general it is difficult to look into the future at the moment. Several unresolved questions surrounding geopolitics remain unresolved. In addition, other topics such as climate change, which can have a major impact on all of our lives, often fade into the background. Uncertainty is always a big issue in the stock market and in many cases it causes the price to drop.

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Perhaps the best example of this at the moment is the section Varta (DE000A0TGJ55), which reached a new record low of 7.44 euros last week. By the weekend it had risen again to 8.19 euros. However, this remains a minus of almost 60 percent since the beginning of the year. The company announced shortly before that the initial remedial measures were insufficient. The new restructuring plan is now expected to be completed by the middle of the year.

Some analysts also reacted to this, such as George Galliers from Goldman Sachs quickly suspended his rating on Varta, as “Der Aktionär” reports. There is no longer an adequate basis for things like price targets or profit forecasts. Perhaps this is also due to the fact that the 2023 annual report was postponed indefinitely after the hacker attack. Investors are looking more than ever at an uncertain future, which has led to further price losses.

Nel ASA needs to deliver urgently

In Nel ASA (NO0010081235) Investors are also looking ahead with great anxiety. The company has recently been able to reduce losses to some extent. However, shareholders reacted angrily to the fact that incoming orders decreased. Therefore, the share price came under great pressure and it was only with great difficulty that the support of EUR 0.40 could be defended until the end of the week.

The annual general meeting is scheduled for Nel ASA tomorrow. It is not known in advance if and what information the company can present here. But one point of view or the other will be important. Because it may be the last chance to gain confidence from investors. However, further disappointments could close the next season on the charts.

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BYD: Is it still worth it?

At first glance, there is not much to complain about with the Chinese car manufacturer WORLD (CNE100000296). Contrary to the trend of the industry, the company has been able to continue to increase the delivery figures this year. This applies to the all-important domestic market and overseas expansion efforts. But investors can’t be happy about this, because this development required a whole series of price reductions.

Tesla recently indicated that the price war may not be over yet. This raises doubts about margins at BYD as well. High sales figures are one thing. But if they do not bring high profits, this scares many investors. Doubts are evident in BYD’s share price. Over the year, the name fell by almost ten percent on local trading sites to 23.99 euros at the end of the week.

Lufthansa plays it safe

He doesn’t want any uncertainty Lufthansa (DE0008232125) in their flights and therefore decided last week to suspend flights to Israel until Saturday morning. The background was reports of an Israeli attack on Iran, which naturally led to concerns about another retaliatory strike.

Not much has happened since then and any economic damage to Lufthansa is likely to be minimal. According to media reports, only four flights were ultimately affected by the failure. But the example clearly shows the big question marks hanging over the industry. Conflicts around the world can cause major disruptions to air traffic at any time. This does not leave shareholders alone and Lufthansa was recently quoted at 6.72 euros, just above the 52-week low of 6.30 euros. Fears of further increases seem to outweigh hopes for a strong summer trade.

Excitement is guaranteed

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Whatever the future holds, investors will have to prepare for the fact that uncertainty will always be the norm. Unfortunately, safety is rare in the stock market and even the most interesting rally can end quickly if the news situation does not cooperate. The stocks mentioned here are currently full of doubts and unanswered questions. Whether we can be talking about a completely different topic in this matter tomorrow remains to be seen. At least it’s not boring, although most investors would be happy to be without the excitement.

22.04.2024 – Andreas Göttling-Daxenbichler

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