Dax starts solidly – Nagarro surges after takeover offer from Persistent

As the two companies announced in Munich overnight from Friday to Saturday, Persistent is offering 81 euros per Nagarro share. This puts the offer price at roughly double the Xetra closing price from Friday. The offer values Nagarro's share capital at just over one billion euros. Persistent itself currently has a market capitalization of just over seven billion euros.

Safran in talks over Exail

Already on the previous Friday, the Nagarro stock had gained almost 20 percent. Citigroup assessed the takeover offer as a "weiteren Schritt in der laufenden Konsolidierung der IT-Dienstleistungsbranche". Nagarro specializes in digital engineering and software development and is among the better-known medium-sized IT providers in Germany.

Alongside Nagarro, another stock was in the spotlight: shares of Exail Technologies rose 3.4 percent to 120.70 euros. The background is exclusive negotiations by engine manufacturer Safran with the maker of mine-clearing sea drones over a possible takeover. A purchase price of 128.50 euros per share is reportedly under discussion.

Chip stocks and Nasdaq as support

The chip sector moved upward again on Monday. Semiconductor stocks such as Infineon, ASML, and STMicroelectronics were once again in demand. In the broad-based Stoxx Europe 600, technology stocks led the winners list. The recovery on the US tech exchange Nasdaq after the weak Friday provided additional tailwind. They were also helped by signs of a recovery on the US tech exchange Nasdaq following Friday's weakness.

By Monday midday, the eurozone leading index EuroStoxx 50 fell 0.08 percent to 6,217 points. European leading bourses thus showed slight losses. The Swiss benchmark SMI and the British FTSE 100 also declined: the SMI moved further away from its record high from Thursday with a loss of 0.26 percent to 14,136 points. The British FTSE 100 went down 0.27 percent to 10,480 points.

Construction, chemicals, and real estate stocks under pressure

Losers in a weak sector environment were primarily cyclicals. In contrast, the cyclical construction and building materials as well as chemicals stocks, and the recently well-performing interest-rate-sensitive real estate titles, counted among the biggest losers. The cyclical sectors suffered from general uncertainty over economic developments in Europe.

Prosus benefits from Tencent stake

Among individual stocks, Dutch internet investment holding Prosus also stood out positively. The Dutch internet investment holding was able to more than double its adjusted operating result in the past fiscal year thanks to a strong run in all three of the group's e-commerce segments. In the EuroStoxx, Prosus was among the top performers with a price gain of 2.5 percent. In particular, the Chinese internet firm Tencent, still Prosus' most important investment, continues to contribute billions to the group's earnings.

British American Tobacco facing job cuts

On the losing side was tobacco group British American Tobacco (BAT). Shares of British American Tobacco (BAT) went down 2.1 percent. The background is reports of a far-reaching corporate restructuring with job cuts. The plan is to reduce the worldwide workforce of 47,000 by roughly one-fifth, reports the news agency Bloomberg, citing an internal company memo. The move is part of a broader cost-cutting strategy, according to informed circles.

Hormuz de-escalation supports sentiment

Geopolitically, the dispute over the Strait of Hormuz drew attention. As the news agency dpa learned from informed circles in Washington, the US and Iran intend to suspend their mutual attacks in the dispute over the Strait of Hormuz for the time being and continue negotiations, according to US information. "Beide Seiten werden vorerst von weiteren Maßnahmen absehen", the news agency dpa learned from informed circles in Washington. Ships could move freely while talks on implementing the framework agreement continue. Such an easing would also relieve energy prices and thus inflation in Europe.

On the foreign exchange markets, the euro was slightly in positive territory at midday. Risk positioning increased again, as the hope of de-escalation in the Middle East somewhat reduced demand for safe havens. Investors are now looking with anticipation to the US inflation data due on Wednesday, which could provide hints on the further rate path of the US Federal Reserve. The quarterly earnings season is also gaining further momentum this week.

Overall, the picture remains mixed: while technology and takeover candidates are clearly in focus and cause significant price movements, classic cyclical stocks and the tobacco sector are under pressure. The German leading index is likely to start the trading day with a moderate gain, supported by the prospect of stabilization in international relations and a continued recovery in the technology sector.