Analysts: Conti’s DAX re-entry won’t make immediate waves

Following the news that Continental AG shares will once again be traded on the German DAX list, financial analysts have been assessing the impact that this likely to make on the company’s share price. For its part Morgan Stanley estimated that the impact will actually be “relatively small from a trading perspective – circa 1-2 days of trading volume and circa 1-2 per cent of the current available freefloat.”

They also suggested that the move to the DAX needs to be put into context: “although inclusion in the DAX would be a important benchmark, the net effect of passive index buying is reduced as Conti would be leaving the M-DAX. So whilst the potential inclusion will provide the shares with a positive tailwind, the effect may not be as large as people initially thought.”

Changes to the DAX index made on 5 September will come into effect on 21 September. This, according to Morgan Stanley representatives, is when one would expect the index tracker buying to begin making some kind of impact.