The correction in Germany’s blue-chip DAX index opens up opportunities for investors, one strategist said. ‘Deutsche Telekom (DTE) stands out at as a little bit more attractive, as it is in the process of trying to strip out T-Mobile (TMUS),’ said Alastair McCaig, a markets analyst with London-based IG Markets. ‘There’s also lots of speculation that they are eyeing up an acquisition of British telecommunications company BT (BT).’ McCaig said Germany’s telecommunications space is ripe for M&A activity, ‘as the amalgamation between satellite, broadband, mobile and content continues to look very attractive and the lines between companies that straddle those sectors becomes increasingly blurred.’ Germany’s DAX has slumped 11 percent since its April 10th peak of 12,374.73, according to data compiled by Bloomberg. A decline of that magnitude screams ‘correction,’ which is loosely defined a drop in a major stock index by at least 10 percent. ‘When you consider that [Europe’s] quantitative easing policy is still in place and unlikely to end in September 2016, which is what’s penciled in, there’s always going to be some supportive buying creeping in,’ McCaig added. He said the correction in German stocks will entice some buyers who have been sitting on the sidelines to buy German stocks, but perhaps not as enthusiastically, given the summer months. Meanwhile, HSBC (HSBC), the largest bank in Europe, said it will cut some 50,000 jobs in an effort to reduce costs by $5 billion throughout the next two years, per a statement to the Hong Kong Stock Exchange.
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