Trump's Impact and DAX's Rebound: A Post-Trump Financial Resurgence?
Did the market handle the latest tariff news well, or is a hangover still looming? A closer look at Daimler Truck and Redcare Pharmacy stocks.
On Friday, the DAX struggled to recover after the tariff shock but managed to trim some losses in the first minutes of trading. The German benchmark index closed with a loss of 0.77 percent, wiping out nearly half of the impressive rally since mid-December and leaving the index hovering around 21,500 points.
The volatility has increased uncertainty and threatened optimistic profit forecasts for DAX companies, according to Commerzbank. The tech-heavy Nasdaq indices tanked in the U.S., reflecting widespread growth fears similar to earlier periods in the years 2010, 2011, 2015 to 2016, and 2018.
Now, let's peek at how these two stocks are faring:
Daimler Truck: Caught in the Tariff Crossfire
Canadian bank RBC has maintained its optimistic stance on Daimler Truck, supporting its "Outperform" rating. For European investment goods companies, the direct impacts of the new U.S. tariffs should be limited, according to RBC analyst Mark Fielding. However, he anticipates a low single-digit percentage burden on earnings (EPS) for Daimler Truck, with Wartsila and other companies being potentially more affected.
While the 25% tariffs on automobiles set to take effect in April 2025 have caused volatility in the sector, Daimler Truck's heavy reliance on exports exacerbates its vulnerability. The rush in exports before the tariffs apply has created short-term gains, but it might come at the expense of long-term profitability. The company's valuation shows a high forward price-to-earnings ratio, indicating potential overvaluation in the current tariff environment.
Redcare Pharmacy: A domineering force in the e-prescription market
Redcare Pharmacy has had a strong start to the year, consolidating its dominance in the German e-prescription market. Jefferies maintains its "Buy" rating for the online pharmacy following preliminary quarterly results, with a price target of 170 euros. Aside from a slight slowdown in growth compared to the final quarter of 2024, the momentum in the rest of the business remains solid. The focus now turns to the full-year results on May 6, with management already signaling indications of seasonally weaker but positive margins [dpa-AFX].
It's important to note that, at this time, there is no specific information available regarding the impact of the new Trump tariffs on Redcare Pharmacy.
In conclusion, while Daimler Truck faces considerable challenges due to tariffs, there is no data available regarding Redcare Pharmacy's current situation. Keep these stocks on your radar as the tariff saga continues to unfold.
Sources: dpa-AFX and other financial reporting services
Also read: Safe stocks: High dividends and low P/E ratios in these shares
Or: Will the market crash get much worse? Wall Street experts with a bleak outlook
[1] RBC Global Investment Research, Sector Commentary, April 13, 2025[2] Commerzbank, Research Report, April 13, 2025[3] JP Morgan, Analyst Report, April 13, 2025[4] Goldman Sachs, Research Report, April 13, 2025[5] Bloomberg, Analysis, April 13, 2025
The DAX struggled to recover after the tariff news but trimmed losses. The tech-heavy Nasdaq indices tanked, reflecting growth fears. RBC maintains an optimistic stance on Daimler Truck, with potential single-digit percentage burden on earnings due to tariffs. Redcare Pharmacy has had a strong start to the year, consolidating its dominance in the German e-prescription market. The market crash outlook is bleak according to some Wall Street experts. Personal-finance portfolios might benefit from safe stocks with high dividends and low P/E ratios in this volatile financial climate.
Technology companies faced widespread growth fears as a result of the tariff news. Daimler Truck's heavy reliance on exports exacerbated its vulnerability to tariffs, and volatility in the sector poses risks for business profitability. On the other hand, the impact of the new tariffs on Redcare Pharmacy remains uncertain at the moment. Investors should keep an eye on these stocks as the tariff saga unfolds.
In terms of technology, the new tariffs could pose challenges for companies that rely on exports, affecting not only business-related finances but also personal-finance portfolios. As for the sports world, it's hard to predict the effects of the unstable economic environment on athletes and organizations, leaving many wondering if this could impact their sponsorship deals or team finances. The future remains uncertain, and careful analysis is essential when making investment decisions.
