DE30: Adidas seeks billions in state aid

• European stocks start Friday's trading lower

• DE30 struggles to steer away from 9,500 pts mark

• Adidas (ADS.DE) seeks €1-2 billion in state aid

Stock market indices from Europe trade mostly in the red today. However, the scale of declines is rather insignificant if we compare it to recent volatility on the global markets. Moods improved somewhat after it was reported that OPEC+ scheduled a meeting for Monday, April 6 to discuss cooperation. Among important reports scheduled for release today one can find NFP (1:30 pm BST) and ISM non-manufacturing (3:00 pm BST). Meanwhile, the number of confirmed coronavirus cases topped 1 million.

Source: xStation5

DE30 struggles to distance away from the 9,500 pts handle. The German index continues to trade near the lower limit of recent trading range. Note that lack of a strong rebound after a test of the lower limit does not bode well for buyers as it hints at demand waning after a quarter-end. Should the index break below the zone near 9,500 pts, it could continue to move lower until it reaches 9,350 pts area. This area is marked with 23.6% retracement level of downward move started in late-February and has recently stopped downward move twice (orange circle). On the other hand, should the index start to recover, the first resistance to watch can be found at 9,700 pts.

Adidas (ADS.DE) failed to break above €215 handle and pulled back below €200 mark later on. The stock is testing the upper limit of the support zone ranging around €190 today. Should it succeed in breaking below it, the next target will be €182 swing level. Note that Adidas business is impacted severely by coronavirus pandemic due to shopping mall closures and lockdown measures. Source: xStation5

According to a Reuters report, new passenger car registrations in Germany dropped 38% YOY to 215 thousand in March. Report highlights that Germans are putting aside bigger purchases during the coronavirus pandemic and the situation is unlikely to change anytime soon. Having said that, German carmakers may have to ask German government for help one day.

According to a Bloomberg report, Adidas (ADS.DE) is seeking over €1 billion in state aid from the German government. The German sportswear manufacturer is in talks with the state-owned KfW bank over loans ranging from 1 to 2 billion euros. 

Henkel (HEN3.DE) announced on Thursday that it has started producing hand disinfectants and will donate them to German hospitals fighting coronavirus pandemic. The German company said that it has produced 25 thousand liters of disinfectant already and plans to produce another 25 thousand in coming weeks.

Beiersdorf (BEI.DE) decided to withdraw a full-year guidance yesterday as coronavirus made it unable to make reliable projections. The German manufacturer of personal care products said that sales in the first quarter dropped to €1.91 billion (-3.7% YoY). These are preliminary figures and the company is expected to release its quarterly report on May 5.

Henkel (HEN3.DE) is trading higher today and makes a break above the recent short-term consolidation range (€70-72). Note that the lower limit of the aforementioned range coincides with 23.6% retracement of the downward move started in late-February. Should recovery continue, the stock will face the first major resistance at 61.8% retracement (€83.50). Source: xStation5