Day's agenda dense: German Chancellor Scholz, Deutsche Post, Rheinmetall, Shell, and more scheduled for discussions today.

Day's agenda dense: German Chancellor Scholz, Deutsche Post, Rheinmetall, Shell, and more scheduled for discussions today.

PEEKING INTO THE CUM-EX SAGA:

Frank and straight forward, let's tackle the pending Cum-Ex scandal. On Friday, Chancellor Olaf Scholz will appear before the Hamburg Parliament's investigative committee to shed light on the controversy. The Warburg Bank, which finds itself deeply entwined in this mess, is under particular scrutiny concerning Scholz's contacts with the bank.

No surprises here, but the SPD politician has a history of denying any involvement in the Cum-Ex scandal. To give you the lowdown, this financial scandal centers around investors swindling capital gains tax on dividend payments through banks' assistance, causing a staggering €100 billion drain from the public purse.

GERMANY’S ROLLERCOASTER YEAR:

Now, let's chat about the Federal Statistical Office's latest data, showing a wild year for German manufacturers. Experts predict an average price hike of 32.0% for the year, up from 32.7% in June. The rise in consumer prices surged to 7.5% in July, a dip compared to June’s spike.

DID YOU KNOW?- ‘Cum-Ex’ is a Latin term coined by German tax authorities, derived from 'cum dividendus ex dividento', meaning 'with dividend after being divided'.

SPOTLIGHT ON COMPANIES:

DAX:

• DEUTSCHE POST – The Administrative Court of Cologne found that the letter postage's tariff approval was illegal between 2019 and 2021. The court rescinded this approval in five proceedings, but don't worry, folks since only plaintiffs like the industry association BIEK can demand refunds from the postal service.

MDAX:

• RHEINMETALL – CEO Armin Papperger is brimming with excitement about the new combat tank “Panther.” Hoping to deliver around half, or 500 units, by 2030, production will commence if a major international buyer is secured in the next couple of years.
• SHELL – The oil giant is grappling with reduced production at its Energy and Chemicals Park Rheinland refinery due to low water levels on the Rhine.
• GAS SUPPLIERS – Besides Uniper, EnBW, and EWE, Sefe (former Gazprom Germania), OMV, and Axpo have followed suit, demanding additional costs through the gas surcharge.
• STRABAG – After ousting Russian partner Oleg Deripaska, a new consortium composed of Uniqa, Raiffeisen Holding, and Hans Peter Haselsteiner’s family foundation is planning a public mandatory offer for Strabag at €38.94 per share. Strabag intends to partake in the offer, potentially acquiring up to ten percent of its own shares.
• AUTO INDUSTRY – A sad note for automotive enthusiasts: the Geneva Motor Show is calling off its schedule for February 2023, citing worldwide geopolitical and economic uncertainties as the main reason. The event will reemerge in November 2023 in Doha, Qatar.

QUALCOMM and Amazon's cloud division are reportedly in talks for a potential return of Qualcomm to the server market with a cutting-edge chip. The plan is to decrease the company's dependence on the smartphone market, as per Bloomberg's sources.

CHIP SUPPLIER APPLIED MATERIALS THRILLS THE MARKET:

Applied Materials, a U.S. chip supplier, is lighting up the markets with a stunning revenue forecast for the forthcoming fiscal quarter. Anticipating €6.65 billion in revenue, it overshoots analyst estimations of €6.57 billion. In the third quarter, the firm broke its own revenue record, clocking in at €6.52 billion.

CENTRAL BANKS AND GLOBAL ECONOMY:

USA/FED – James Bullard, the head of the St. Louis Fed branch, favors a hefty 0.75 percentage point interest rate increase at the U.S. central bank's September meeting. Bullard believes the Fed should act swiftly, moving towards an interest rate that curbs inflation. However, the increase will take approximately 18 months to bring inflation down to the Fed's target of 2%.

GERMANY/TAXES – Amidst increasing energy costs, Germany saw a modest 0.3% increase in tax revenues for federal and state governments in July. This meager rise was mainly attributed to the German government's measures to alleviate the burden of higher energy costs, such as the 2022 child bonus payment and retroactive allowance increases for employees.

1. The Cum-Ex scandal, a significant financial controversy, has recently drawn the attention of the German political sphere, with Chancellor Olaf Scholz set to discuss the matter at an upcoming panel.
2. The ongoing controversy, which has drained approximately €100 billion from the public purse, involves investors swindling capital gains tax on dividend payments, with banks' assistance.
3. In the realm of business and personal-finance, the latest data from the Federal Statistical Office reveals a wild year for German manufacturers, forecasting an average price hike of 32.0% for the year and a consumer price surge of 7.5% in July.
4. In the technology sector, Qualcomm and Amazon's cloud division are reportedly in talks for a potential return of Qualcomm to the server market, aiming to decrease the company's dependence on the smartphone market.

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