Macroeconomic framework conditions

Economic environment

In Europe, and particularly in Germany, economic growth fell short of expectations in 2014. As well as the persistent weakness in the global economy, due not least to growing problems in the emerging economies, the main cause was the political crises in the Middle East and Ukraine, which curbed exports, private consumption and the general willingness to invest. The threat of deflation also dampened the mood.

Following a highly promising start to the year, German economic output lost noticeable momentum. Growth stagnated in the second and third quarter before the mood picked up again somewhat at the end of the year for companies and consumers, partially in light of the low price of oil. The eurozone overall also recorded growth rates nearing the zero mark, with Italy and France among the poorest performers.

Disposable income in Germany was up by 2.2% year-on-year, while the savings ratio was at the previous year’s level.

Framework conditions for trading

Marked share price gains in the first half of the year, due mainly to the interest environment at that time, were followed by a short-term downward trend in the equity markets in summer. This was driven by increasingly gloomy economic forecasts and political crises and came at a time of major fluctuations. The unusually volatile market environment sparked high trading turnover on the German stock exchanges. In value terms, the volume of trading in the German spot market (XETRA, Frankfurt and Tradegate) was up by 10.8% on the previous year’s level. At the same time, the order figures for equities fell by 12.5% and order figures for exchange traded ETFs including exchange traded commodities (ETC) and exchange traded notes (ETN) by 4.3%.

Source: Deutsche Börse AG
* XETRA, Frankfurt Stock Exchange and Tradegate
Entwicklung des DAX vom 30.12.2013 - 30.12.2014

In derivatives trading (Euwax and Frankfurt stock market), stock exchange turnover was up 1.7% on the previous year’s figure. The order figures increased by 5.2%. Whilst fewer investment certificates were traded (– 21.5%), leveraged certificates saw an increase (+13.7%).

Framework conditions for investing

German investors invested heavily again in funds in 2014. The retail funds included in the statistics of the Bundesverband Investment und Asset Management e.V. (BVI) posted inflows of €30.7bn in the first eleven months of 2014 (previous year: €14.4bn). Most in demand were mixed funds and bond funds, while equity funds recorded net outflows.

The ebase fund barometer, which is published four times a year and illustrates the trading volume of over 50 thousand fund advisers, reported a below-average degree of activity in 2014, falling from 111 points in January to an annual low of 67.4 points in May and staying occasionally significantly below 100 points in the following months. It was not until December that fund advisers began to trade more actively again (102.9 points).

Demand for private provisioning products (Riester pensions) increased insignificantly in 2014. The Federal Ministry of Labour and Social Affairs recorded an increase in the number of contracts of 0.8% in the first nine months of the year, primarily as a result of the “Eigenheimrente” pension provisioning scheme. There was only a marginal change in the number of insurance, bank saving and fund contracts.

Framework conditions for banking

The central banks in Europe and the USA retained their policy of low interest rates and continued to furnish liquidity in virtually unlimited amounts. In view of the persistent threats to growth, in June the ECB applied a negative interest rate of – 0.1% for the first time on deposits held with it as well as cutting the refinancing rate first to 0.15%. In September the rates were then reduced again to – 0.2% and 0.05%, respectively. Although the US Federal Reserve stopped buying bonds in October, it chose not to raise key lending rates despite the positive economic trend in the USA.

For the year as a whole, the three-month EURIBOR, which is the decisive rate for some of our investments was down only slightly year-on-year (0.21% as against 0.22%). By the end of the year, however, it had fallen markedly to a mere 0.08%.

Yields on European government bonds fell as the year went on, except in Greece. At the end of the year, the yield on ten-year German government bonds was 0.59%.

comdirect’s Treasury portfolio focuses on top-grade bonds. Strict limits continued to apply to interest income.


Framework conditions for advice

Despite higher property prices and reduced supply in major conurbations, another year-on-year fall in interest rates kept demand for home financing high. The volume of loans for residential property construction increased by 2.7% in 2014. comdirect’s Building Finance Sentiment index, which is calculated in conjunction with the opinion research institute Forsa, stayed considerably above 100 points throughout the entire year and stood at 113.8 points at the end of the year. A value over 100 indicates a high level of willingness to take out building finance loans.

Stimmungsindex Baufinanzierung, Zehn-Jahres-Hypothekenzins