Construction firm Hochtief to join Germany's DAX index

The German stock index DAX is set to welcome a new member, construction giant Hochtief, marking its first entry into the country's leading stock market index.

Effective June 22, Hochtief will replace Porsche Automobil Holding SE, the major shareholder of Volkswagen, in the DAX. Consequently, Porsche SE will be demoted to the MDax, which tracks mid-cap companies. This quarterly review of the DAX family of indices, which also includes the MDax, SDax, and TecDax, is particularly significant for index-tracking funds that will need to rebalance their portfolios, potentially influencing stock prices.

Experts view Hochtief's ascent to the DAX as unsurprising, given its strong stock performance in recent months. The company has benefited from several key market trends, including the booming demand for data centers, substantial infrastructure investment programs, and increased defense spending globally.

In addition to Hochtief's promotion, the MDax will see the inclusion of chipmaker Elmos Semiconductor, chip supplier Siltronic, and semiconductor supplier Suss Microtec. Conversely, Redcare Pharmacy, advertising marketer Ströer, and forklift manufacturer Jungheinrich will be moved from the MDax to the SDax, which comprises 70 smaller and mid-sized companies.