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European indices deliver solid gains on Wednesday
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DE30 bulls don’t give up, 13300 pts resistance in play
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Munich Re (MUV2.DE) is ready to expand in Europe and Asia
Most of the European blue-chips indices launched Wednesday’s trading higher. Spanish Ibex and German DAX are European top performers after two hours of the cash session. Blue-chips index from Portugal is the only one to trade below yesterday’s closing prices. Miners lead advance while travel companies lag the most.
Source: xStation5
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Create account Try a demo Download mobile app Download mobile appThe upper limit of the current consolidation range at 13300 pts continues to be the key resistance for DE30. The German index once again tested this hurdle today and once again failed to break above. Similarity to yesterday’s price action is striking as following a pullback from the upper limit of the trading range, DE30 once again found support at the 50-hour moving average (green line). Nevertheless, bulls just can’t get enough as another massive surge took place shortly after 9:00 am GMT and the index once again made an attempt of breaking above the trading range. Should the index break higher, investors should focus on YTD high in the 13365 pts area. On the other hand, another pullback from the upper limit of the range could see one more test of the aforementioned 50-hour moving average (13245 pts area). Midpoint of the trading range at 13225 pts should act as the final near-term support.
DAX members at the top of the second hour of European session. Source: Bloomberg
Joachim Wenning, CEO of Munich Re (MUV2.DE), said that the German reinsurance company is ready to expand its primary insurance unit Ergo, which focuses on European and Asian insurance markets. The unit has been a subject to a restructuring process that saw jobs cuts as well as sales of non-core businesses. Munich Re plans to expand Ergo’s presence in markets in which the unit is already active.
According to the Handelsblatt report, BMW (BMW.DE) is planning to reduce employee bonuses by 15-20% as a part of savings plan. Meeting on the matter between CEO Oliver Zipse and labor union leader Manfred Schoch is expected to take place today.
Hannover Re (HNR.DE) opened lower today following a downgrade at Morgan Stanley. The Bank lowered recommendation for the stock to “equal-weight” from “overweight”. Price target was set at €175.5. However, share price managed to almost completely cover the downward price gap.
Shares of BMW (BMW.DE) rallied over 25% since late-August lows. A point to note is that the price reacts to retracement levels of the major downward move started at the turn of 2017 and 2018. Having said that, the 50% Fibo level at €77.75 could be the next resistance to watch. However, in the case of the two already-broken retracements - 23.6% and 38.2% - price smashed through them easily and retested them as supports later on. Source: xStation5
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