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European markets sink
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DE30 drops below 15,100 pts
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Thyssenkrupp not sure when dividends will return
European stocks are plunging today following a strong sell-off of the US tech shares yesterday. German DAX (DE30), UK FTSE 100 (UK100), Dutch AEX (NED25) are trading over 2% lower today while French CAC40 (FRA40) drops 1.9%. Indices from Belgium and Poland can be seen as the outperformers as they drop "only" 1%.
German ZEW index for May was released at 10:00 am BST. Expectations index jumped from 70.7 to 84.4 (exp. 70.9) while current situation index improved from -48.8 to -40.1 (exp. -41.6). Following such a strong beat, hinting at improving moods within the German economy, allowed DE30 to recover a small part of today's losses.
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Source: xStation5
DE30 slumped today following a strong sell-off on Wall Street yesterday and in Asia today. German index dropped below a key support level at 15,100 pts, which is marked with the 38.2% retracement of recent downward correction and 38.2% retracement of the upward move launched at the end of March. The index managed to climb back towards 15,100 pts after release of the upbeat ZEW index for May. Nevertheless, bulls were unable to push the index back above this hurdle. In case downward move is resumed, the next support level to watch can be found at 50% retracement of the upward move launched at the end of March (slightly below 15,000 pts mark).
Company News
Thyssenkrupp (TKA.DE) reported a fiscal Q2 net loss of €211 million, compared to a €948 million net loss a year ago. Adjusted EBIT reached positive €220 million, up from a negative €95 million in the previous year. Revenue dropped from €10.11 billion to €8.58 billion. Company said it expects sales growth in fiscal 2021 to come in at a low two-digit percentage while adjusted EBIT is expected to be in the mid three-digit million euro range. Company said it is unable to tell when dividends may be resumed.
Lufthansa (LHA.DE) is reportedly in talks with banks over a €3 billion capital increase in order to pay off a state bailout received during the coronavirus pandemic.
Ceconomy (CEC.DE) reported earnings for the fiscal Q2 2021. Adjusted EBIT loss widened from €131 million in January-March 2020 to €146 million now. Nevertheless, the company has managed to report a net profit of €94 million for the quarter. Sales dropped from €4.63 billion to €4.32 billion. Online sales were almost 150% YoY higher at €2.12 billion. Company said that it is unable to provide a full-year outlook amid uncertainty when restrictions will be lifted.
Shares of Thyssenkrupp (TKA.DE) are dropping hard today amid broad risk-off moods. While the company decided to lift full-year guidance, comments on dividends may additionally weigh on share price today. Upward trendline in the €10.80 area is a key near-term level to watch. Source: xStation5
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