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European stock markets trade lower
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DE30 fails to break above 15,675 pts resistance
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BASF upgraded full-year forecasts
European stock markets launched today's cash session mostly flat. However, bears started to gain control later on and now most of European blue chip indices trade lower. Indices from Western Europe trade lower with UK FTSE 100 (UK100) and Spanish IBEX (SPA35) being top laggards. Stocks from Poland, Russia and the Netherlands trade higher.
Economic calendar is almost empty today. Investors will be offered some speeches from Fed and ECB members as well as WASDE report. However, neither of these is expected to have a major impact on stock markets. Moreover, slightly lower trading activity in Europe seems to be a result of yesterday's Euro 2020 finals.
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DE30 continues to trade sideways but the index is more and more often visiting the 15,675 pts area, which marks the upper limit of the range. DE30 attempted to break above this hurdle at the start of today's cash session but bears overcame bulls. Short-term resistance zone in the 15,615 pts area is the near-term target for sellers. If this is not enough to halt pullback, attention would shift to 15,520 pts area. Source: xStation5
Company News
European Commission fined Volkswagen (VOW1.DE) and BMW (BMW.DE) for their role in cheating emission software. Two German carmakers colluded with each other as well as Daimler (DAI.DE). Volkswagen was fined €502 million while BMW received a €373 million fine. Daimler was not fined as it was granted immunity for revealing the existence of the collusion. European Commission said that Daimler would receive a €727 million fine if it did not have immunity in the case.
BASF (BAS.DE) announced that its EBIT reached €2.32 billion in Q2 2021, while revenue reached €19.75 billion (exp. €17.16 billion). Company said that price increase of 35% combined with 28% volume increase were more than enough to offset a negative FX impact of 7%. BASF decided to upgrade full-year forecasts and now expects sales in the €74-77 billion range, up from previous forecast of €68-71 billion. EBIT is seen reaching €7.0-7.5 billion, up from €5.0-5.8 billion expected earlier.
BASF (BAS.DE) extended upward move at the beginning of today's trading. However, bulls were unable to hold onto these gains for long and the stock pulled back following a failed attempt of breaking above 50% retracetrement of a recent correction (orange circle, €68.35 area). Zone ranging above the 38.2% retracement (€67.35) is a near-term support to watch. Source: xStation5
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