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Indices plunge on virus fears and weak German GDP
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DE30 tests 12,500 pts
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Volkswagen (VOW1.DE) reports €800 million operating loss
European stock markets are trading lower on Thursday after a new record in daily Covid-19 cases was reported yesterday. German GDP report added to the pressure as it showed a deeper than expected contraction. US GDP report scheduled for the afternoon may provide some additional volatility.
Source: xStation5
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Open account Try demo Download mobile app Download mobile appDE30 slipped below the upward trendline today. The index continued to move lower breaking through the lower limit of the Overbalance structure at 12,630 pts. So far, downward move was stopped by the 12,500 pts handle. However, as the index still remains close to this area, the chance of deepening previous decline remains high. In such a scenario, the zone at 12,400 pts should offer some support. There are two risk events remaining today for equities - US GDP report release at 1:30 pm BST and Big Tech earnings after the Wall Street session closes. Keep in mind that German reading missed expectations today. Recovering above 12,630 pts handle would be a positive sign for bulls. However, with virus case count on the rise, risks seem to be tilted to the downside.
DAX members at 10:39 am BST. Source: Bloomberg
Volkswagen (VOW1.DE) released a quarterly earnings report for the first half of 2020. The German carmaker reported an operating loss of €800 million, compared to a €10 billion gain last year. Company reported 23.2% YoY decline in sales while car deliveries declined 27.4% YoY. Additionally, the company will propose a lower dividend to an annual general meeting in September. Dividend per share is proposed at €4.80, down from €6.50 last year.
Deutsche Boerse (DB1.DE) said that its net profit dropped 4% in the second quarter of 2020, to €256.7 million. Analysts expected an increase. The company left full-year guidance unchanged.
TUI (TUI.DE) is trading lower today. The European travel company announced that it will cancel flights to Spanish islands until 4 August due to restrictions placed by the UK government.
Volkswagen (VOW1.DE) slumped today after releasing a poor earnings report. Stock dropped below support zone at €140 and is testing lower limit of the Overbalance structure in the €137.50 area. Finishing the day below this hurdle could herald a longer downward move with support at €126.50 being the next target. Source: xStation5
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