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Porsche, Puma to join Germany's DAX as index expands

09/03/2021 | 06:10pm EDT
German share price index DAX graph is pictured at the stock exchange in Frankfurt

FRANKFURT (Reuters) - German carmaker Porsche and sportswear maker Puma will join the nation's premier DAX stock index, as it expands to 40 from 30 companies in the biggest overhaul of its 33-year history, the exchange operator Deutsche Boerse said on Friday.

The expansion, contemplated for years, got a push in reaction to the collapse of German payments company Wirecard, which dramatically fell from grace in 2020, just two years after promotion to the benchmark index.

A bigger index means greater diversific
ation and potentially more stability for investors. Graphic: DAX's climb,

The move promotes an array of companies to an index previously reserved for German corporate titans like Volkswagen and Siemens.

Other new entrants include the plane manufacturer Airbus and the online fashion retailer Zalando.

The changes are effective on Monday, Sept. 20.

Wirecard's demise embarrassed the German government and stained the nation's reputation as a safe haven investment, accelerating the reform imitative backed by Deutsche Boerse Chief Executive Officer Theodor Weimer.

Deutsche Boerse announced the overhaul plans last November, saying the changes would improve quality of the DAX indexes and align them with international standards..

Over the past year, Deutsche Boerse has also imposed more stringent membership criteria in financial reporting and profitability.

Manfred Schlumberger, portfolio manager at Starcapital, said he doubted the expansion would make the index more attractive.

U.S. indexes are more attractive than their European counterparts because they have a high portion of future-oriented industries like technology and communication, he said.

"The DAX doesn't get that through the overhaul because those industries simply don't exist here," he said

The remaining new entrants include: health technology company Siemens Healthineers, flavour and fragrance maker Symrise, lab equipment maker Sartorius, chemicals distributor Brenntag, meal-kit company Hellofresh, and genetic testing specialist Qiagen.

The number of constituents in the mid-cap index will shrink to 50 from 60.

(Reporting by Tom Sims and Hakan Ersen; Editing by Chris Reese and David Gregorio)

By Tom Sims and Hakan Ersen

© Reuters 2021
Stocks mentioned in the article
ChangeLast1st jan.
AIRBUS SE -1.10% 113.64 Real-time Quote.27.98%
BRENNTAG SE 1.02% 82.92 Delayed Quote.30.91%
DEUTSCHE BÖRSE AG 1.13% 147.35 Delayed Quote.5.82%
HELLOFRESH SE 4.01% 80.96 Delayed Quote.28.10%
PORSCHE AUTOMOBIL HOLDING SE 2.43% 90.24 Delayed Quote.60.00%
PUMA SE 0.69% 101.55 Delayed Quote.10.05%
QIAGEN N.V. -0.33% 51.64 Delayed Quote.-2.29%
SARTORIUS AG 0.00% 580 Delayed Quote.68.12%
SIEMENS AG 0.14% 141.26 Delayed Quote.20.20%
SIEMENS HEALTHINEERS AG 0.70% 57.34 Delayed Quote.36.59%
SYMRISE AG -0.26% 114.3 Delayed Quote.5.44%
VOLKSWAGEN AG 1.33% 198.66 Delayed Quote.30.34%
WIRECARD AG -0.87% 0.1701 Delayed Quote.-45.02%
ZALANDO SE 1.72% 79.36 Delayed Quote.-12.85%
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