Close menu

May 4th, 2022 | 11:26 CEST

Pay attention to financial stocks: PayPal, MAS Gold, Deutsche Bank, Commerzbank - inflation, real interest rate and precious metals!

  • Financial
  • Investments
  • Gold
  • Inflation
Photo credits:

It is going to be a lot of work! The Ukraine war is leaving its ugly mark on the humanitarian and material aspects. A lot of money is needed for reconstruction and the return of the many refugees. Since debt levels are high, interest rates will likely continue to rise to meet the growing need for capital. In addition, there is a shortage of fossil raw materials, and there is a threat of supply shortages. In order to avert a default, Russia has settled USD 650 million in interest on various foreign securities, as expected. Can financial chaos still be averted? Who will pay for the war damage? Financial stocks and gold come into focus during large debt movements. Where are the opportunities for investors?

time to read: 5 minutes | Author: André Will-Laudien
ISIN: PAYPAL HDGS INC.DL-_0001 | US70450Y1038 , MAS Gold Corp. | CA57457A1057 , DEUTSCHE BANK AG NA O.N. | DE0005140008 , COMMERZBANK AG | DE000CBK1001

Table of contents:

    Brodie Sutherland, CEO, Tocvan Ventures
    "[...] One focus will be on deposits near the surface. These would be good arguments for a quick production decision using the low-cost heap leaching method. [...]" Brodie Sutherland, CEO, Tocvan Ventures

    Full interview


    Inflation and rising interest rates - The stagflation scenario is alive

    It is a foregone conclusion! Central bank interest rates are being successively raised to stem the rise in prices and curb the increased demand for capital worldwide. Despite the high money supply, nevertheless, the velocity of circulation is slowing, evidence that economic activity is declining. For economists, this scenario is a dire version of describing the economy, called stagflation: stagnant growth accompanied by inflation. The inflation is not fed by booming demand but by a massive supply deficit in all sectors. And although the assembly lines in industry are slowly coming to a standstill, prices continue to rise! The consumer becomes very insecure and drives up his savings rate. Everything is counterproductive!

    PayPal - Price jump after the quarterly figures

    In the described stagflation scenario, market participants try to lower their costs. A guarantor for low transaction costs is the former payment division of eBay, better known as PayPal. The Company's valuation has increased by more than 11% after the publication of its quarterly figures. What is the market celebrating?

    PayPal has taken a massive hit in the last 6 months, but the latest figures were extremely well received on the stock market. Earnings per share of 0.88 were in line with expectations, while revenue of USD 6.48 billion slightly exceeded analysts' estimates, which should not really trigger any leaps of joy. That is all the more true as the outlook for the current year has even been slightly lowered. The forecast for sales growth in 2022 was lowered from 15-17% to 11-13%. Earnings are also expected to be around 15% below estimates.

    The current share price jump must therefore be viewed from the technical side. The PayPal share has lost more than 60% on a 12-month view and reached a preliminary low of EUR 77.9 as of the end of April. From there, there was now a leap upwards; the Anglo-Saxons jokingly say: "Dead cat bounce!" - i.e. a prompt rise after a long period of losses. Watch calmly for a few more days to see if the trend has really turned because the sudden turnaround occurred directly at the multi-year upward trend. If so, from a technical point of view, the way would now be clear in the direction of EUR 100-115.

    MAS Gold - First results from North Lake

    Canadian company MAS Gold Corp. is an explorer focused on potential gold projects in Saskatchewan's prospective La Ronge gold belt. Four properties are being explored in this belt: Preview-North, Greywacke Lake, Elizabeth Lake and Henry Lake. They extend along a total of approximately 60 km of the geologically prospective La Ronge, Kisseynew and Glennie domains, which together form the La Ronge Gold Belt.

    Initial results are now available from a completed drill program. It focused on the Company's North Lake deposit, where a total of 4,123 meters of diamond drilling was completed in 34 holes. Preliminary assay results from 5 of 34 holes contain average grades of 0.61 to 1.88 grams of gold per tonne of rock over lengths ranging from 14 to 99 meters. An additional 772 and 996 metres of drilling were completed at the Point deposit at Ramsland Lake and the recently acquired Preview SW gold deposit.

    The Company's objective is to define a sufficient gold resource over the next few years to make a medium-term production decision. MAS is currently well-positioned to further improve its key assets in 2022. It will require further investigation of numerous exploration targets on the extensive property using a comprehensive database. MAS shares, which are currently trending sideways, are being held back by the weak gold price and should immediately take off again when the precious metals turn around.

    Deutsche Bank and Commerzbank - The big turnaround hope for 2022

    What leads to the constant increase in price for consumers, e.g. for the purchase of real estate, is like a summer rain for banks after the drought years: Rising interest rates! The balance sheets of the financial sector are easing noticeably, and operating margins are also returning to bearable dimensions. The share prices of the financial institutions have thus risen sharply in the last 2 months, but now new woes are looming.

    On the one hand, the probable, imminent increase in the EU key interest rate is providing investors with corresponding price fantasies. On the other hand, the raid at Deutsche Bank in Frankfurt last week because of possible money laundering violations hit investors hard in the stomach - because it would not be the first time that the financial institution has to fight legal problems. According to information from DPA, investigators accuse Germany's largest financial institution of having filed the relevant money laundering suspicious activity reports too late, although there had already been suspicions earlier. DBK shares lost a full 15% in just 5 days.

    With its latest figures for the last financial year, Commerzbank, in particular, caused a stir, with an operating profit of half a billion euros exceeding analysts' expectations by double. There was talk of "crazy good figures" in financial circles, although the full report will not be published until May 12. Despite the good news, financial institutions performed consistently poorly in April. Experts attributed this to higher costs and concerns about the negative impact of the Ukraine war on annual targets. There is a threat of write-downs on Russian loans here, and Ukraine's credit rating is also falling significantly. Technically, the EUR 9 and EUR 6 marks are an important holding line to the downside for DBK and CBK shares, respectively. The significant period of operating losses should turn to the good in the current year, despite the write-downs in the East. Conclusion: Buy in on weak days!

    Sharp interest rate rises and inflation are taking their toll on stock prices. The return of a positive capital market interest rate is nevertheless a blessing for the financial sector. Still, unfortunately, the negative real interest rate is leading to a loss of purchasing power among consumers. Financial stocks and precious metals should rise in this environment. But it does not seem so simple. The junior MAS gold can already report individual results, which should slowly bring a higher valuation into the running.

    Conflict of interest

    Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") may hold shares or other financial instruments of the aforementioned companies in the future or may bet on rising or falling prices and thus a conflict of interest may arise in the future. The Relevant Persons reserve the right to buy or sell shares or other financial instruments of the Company at any time (hereinafter each a "Transaction"). Transactions may, under certain circumstances, influence the respective price of the shares or other financial instruments of the Company.

    In addition, Apaton Finance GmbH is active in the context of the preparation and publication of the reporting in paid contractual relationships.

    For this reason, there is a concrete conflict of interest.

    The above information on existing conflicts of interest applies to all types and forms of publication used by Apaton Finance GmbH for publications on companies.

    Risk notice

    Apaton Finance GmbH offers editors, agencies and companies the opportunity to publish commentaries, interviews, summaries, news and the like on These contents are exclusively for the information of the readers and do not represent any call to action or recommendations, neither explicitly nor implicitly they are to be understood as an assurance of possible price developments. The contents do not replace individual expert investment advice and do not constitute an offer to sell the discussed share(s) or other financial instruments, nor an invitation to buy or sell such.

    The content is expressly not a financial analysis, but a journalistic or advertising text. Readers or users who make investment decisions or carry out transactions on the basis of the information provided here do so entirely at their own risk. No contractual relationship is established between Apaton Finance GmbH and its readers or the users of its offers, as our information only refers to the company and not to the investment decision of the reader or user.

    The acquisition of financial instruments involves high risks, which can lead to the total loss of the invested capital. The information published by Apaton Finance GmbH and its authors is based on careful research. Nevertheless, no liability is assumed for financial losses or a content-related guarantee for the topicality, correctness, appropriateness and completeness of the content provided here. Please also note our Terms of use.

    Der Autor

    André Will-Laudien

    Born in Munich, he first studied economics and graduated in business administration at the Ludwig-Maximilians-University in 1995. As he was involved with the stock market at a very early stage, he now has more than 30 years of experience in the capital markets.

    About the author

    Related comments:

    Commented by Armin Schulz on February 21st, 2024 | 07:30 CET

    Barrick Gold, Desert Gold, Renk - Golden times everywhere?

    • Mining
    • Gold
    • Defense

    The world is full of economic uncertainty and geopolitical tensions. These are ideal conditions for gold, which is still considered a safe haven. There are now several factors that point to a sustained upswing in gold prices. One factor is the increased involvement of central banks, which are increasing their reserves to an extent not seen for decades. Another factor is the discussion within the BRICS nations about introducing a new currency backed by gold as a counterweight to the dominant US dollar. Therefore, today, we look at two gold companies and shed light on Renk, a representative of the defense industry, which is also experiencing golden times.


    Commented by Fabian Lorenz on February 21st, 2024 | 07:00 CET

    Top news: BYD, Bayer and Globex Mining

    • Mining
    • Gold
    • Commodities
    • Electromobility
    • chemicals

    Bayer shocked investors yesterday with the announcement of its dividend cut, which shouldn't have been much of a surprise. The Company is burdened with high debt, endless legal fines, and an empty pharmaceutical pipeline. In an initial reaction, analysts have lowered the share price target. BYD, on the other hand, is doing well operationally. Only the share price is not picking up. Will a share buyback turn the share price around? For those who want to profit from the commodity boom with reduced risk, then Globex Mining's stock is attractive. The news flow is strong, and those who act quickly can still register and follow the live presentation of the mining incubator at the 10th International Investment Forum, IIF, today.


    Commented by Stefan Feulner on February 19th, 2024 | 07:00 CET

    Renk, Manuka Resources, and Airbus with explosive news

    • Mining
    • Gold
    • Vanadium
    • Batteries
    • renewableenergies

    Germany's leading index, the DAX, managed to surpass the 17,000-point mark significantly this week, reaching a new all-time high at 17,198.50 points. After a weak IPO year in Germany in 2023, in which only three companies dared to go public, the Renk Group set an exclamation mark with a rocket launch. Whether the high level of the DAX can be maintained will also depend on Allianz, Fresenius and Heidelberg Materials, which will publish their figures for the past financial year in the coming week.