Mercedes 1999 Annual Report Download - page 32

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THE DAIMLERCHRYSLER SHARES
26
85
100
115
130
145
MSCI Automobiles Index
DAX
DaimlerChrysler
J 99A 99F 99 D 99 Feb.
15
00
O 99A 99D 98Nov.
17
98
Share Price Index
(as of Nov. 17, 1998)
UPWARD TREND ON INTERNATIONAL MARKETS. The year
1999 saw stock markets in North America and Europe
fluctuate wildly, before closing the year at record highs.
Driven by a powerful year-end surge, the DAX rose 39% over
the year to 6,958. The Dow Jones Industrial Average was up
25% at end-1999, the Dow Jones Euro Stoxx 50 Index 47% and
the London FTSE-100 18%. Japan’s Nikkei Index rose 37% to
18,934 points, although it was still about 50% below its record
level at end-1989. The upward trends continued into mid-
February 2000. Both the DAX, with 7,812 points on February
11, and the Dow Jones, with 11,750 points on Januay 14, set
new records.
The upward trend on world stock markets resulted from a
high volume of liquidity in search of investment opportunities;
low interest rates and the generally positive prospects for
accelerated economic growth. Large international mergers
and merger speculation throughout various branches of
industry also fueled rises on capital markets. Telecommuni-
cations and IT stocks particularly benefited, as did financial
stocks. Automotive stocks, however, lagged behind the
buyoant market trends.
DCX PERFORMANCE.
Despite positive earnings prospects for
DaimlerChrysler throughout 1999 as reflected in key
indicators for DCX the ticker abbreviation of our shares, the
company’s share price did not benefit from the generally
favorable performance of capital markets (see table).
Immediately following DaimlerChrysler’s launch on November
17, 1998 “Day One”, the DaimlerChrysler share price quickly
surged above the average for German corporations.
Financial analysts pointed to the benefits of the merger and
a strong North American automobile market. The subse-
quent fall of the share price was due to the generally more
modest development of world markets and the more
reserved analyst forecasts in view of expected medium-term
trends on automobile markets.
DCX fell sharply at the end of July, despite good
six-month results. Some investors were concerned
that the US automobile market might slow and impact on
DaimlerChrysler’s earnings. At the end of September 1999,
DCX reached a year-low of €63.26 in Europe and $65 5/16
in the US. However, the share price subsequently recovered
for a while, closing the year at €77 in Europe and $78 1/4
in the US. On February 15, 2000, it was trading at €66.29
and $66, respectively.
HIGH VOLUME OF DAIMLERCHRYSLER SHARES TRADED.
DaimlerChrysler’s weighting in the German DAX 30 was 7.5%
at the end of 1999, the fourth most heavily weighted stock on
that index. It is the only automotive stock in the Dow Jones
Euro Stoxx 50 Index, with a 2.9% weighting, putting DCX in
ninth place. DaimlerChrysler has the second-biggest market
capitalization among automobile manufacturers after Toyota.
T H E D A I M L E R C H R Y S L E R S H A R E S
■Upward trend on international stock markets
■Performance of automotive stocks lagged behind international indexes
■Share price does not reflect positive business developments at DaimlerChrysler
■Highest dividend yield in the automotive industry
Shareholder base
expanded significantly