Germany: Lufthansa exits country's benchmark DAX index over coronavirus losses

The Lufthansa group was relegated from the main German Stock Exchange DAX into the mid-cap M-DAX for medium-sized companies or corresponding market values after hard coronavirus losses, as Baader Bank financial expert Robert Halver explained from the DAX trading floor in Frankfurt on Monday. «There are two criteria why you get into the DAX [German stock exchange index],» Halver said. «It is market value and trading. We have a situation where a huge company is under discussions. Why is Lufthansa out of DAX now? Because corona has struck [them]. It's not because Lufthansa has been managing poorly,» he stated. «If you are in it, it has kind of a club-character, it makes you special. The funds have to buy this value, too,» Halver continued, as the company is no longer part of the 30 major German companies that shape DAX. The largest German airline and second-largest in Europe in terms of passenger numbers was seen operating flights in Frankfurt airport amid another possible upcoming bailout from the government after they agreed to a rescue deal worth €9bn ($10,2bn) amid a first-quarter net loss of 2.1 billion euros ($2.3 billion). «I suppose Lufthansa will be rescued,» Halver said. «If some don't want the influence of the government, okay, but then Lufthansa will organise its insolvency with their own responsibility. And then, the crane will turn into a plucked chicken,» he stated. Lufthansa reportedly also said it doesn't expect the current crisis to end before 2023. Europe's biggest airline is in negotiation with unions representing flight workers to minimise the number of cuts. A final agreement is expected to be reached by June 22.
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