Dax crashes after Yuan devaluation in China from – SPIEGEL ONLINE

In fact, there was some good news: Greece and the donors have agreed on the key points of the next aid package. But not even these successful negotiations could cheer on the stock market investors. Because previously had provided a drumbeat China’s central bank. In the fight against the economic slowdown in the People’s Republic, the central bankers have devalued the currency of the country dramatically.

With the Yuan devaluation by two percent Chinese goods are cheaper on the world market, ie competitive. For the European and American rivals that’s bad. For investors in Germany the devaluation stoked concerns about German China exports. The Dax went into a tailspin. The close of trading was the leading German index with 2.68 percent in the red at 11,294 points. The significant recovery from the week beginning is thus gone.

The Yuan devaluation weakened the competitiveness of European and American companies in the important Chinese market, wrote analyst Andreas Paciorek from trading firm CMC Markets. The papers of the export-dependent German carmakers and their suppliers, which the weakness in the important Chinese car market and has added experienced, particularly high price declines. Because the yuan devaluation makes their products more expensive for Chinese buyers. The losses were fueled in addition by disappointing car sales figures in China.

In the Daimler Dax slumped – shares the weakest value to 5.15 percent. Continental and BMW each lost more than four percent. The shares of Volkswagen (VW) lost more than three percent.

Investors also worry about the state of China’s economy. “Let the permanent intervention of the Chinese Administration imagine how precarious the situation in the second largest economy in the world actually is,” wrote analysts at Metzler Bank.