Summary:
- European stocks start Wednesday’s session lower
- DAX (DE30) tries to stay within the resistance zone
- Deutsche Bank (DBK.DE) sent termination letters to hundreds of its customers
Yesterday’s US session began in an upbeat moods but the situation turned ugly later on and saw all three major indices from Wall Street finishing the day lower. Such a turnaround set the tone for the Asian and European trading hours. Following declines China, Japan and Australia, the European stock market indices launched Wednesday’s trading lower. Belgian stocks underperformed the most at the beginning of today’s session.
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DE30 run into the resistance zone ranging 12090-12170 pts yesterday and failed to break above it. Today’s pullback may look worrying but as long as the index closes the day above 12080 pts (50-session moving average, green line on the chart above) bulls should not be concerned too much. Source: xStation5
Deutsche Bank (DBK.DE) is one of the worst performing DAX stocks at the beginning of Wednesday’s session. Shares underperforming following the Financial Times report. The newspaper reported that the Bank has sent termination letters to hundreds of its clients. In the letter one can find information that the company will no longer be able to use the Deutsche Bank services in case it fails to supplement the Bank with identity verification documents. Given that the case concerns “hundreds” of Bank’s corporate client, earnings of the German lender may be severely impacted.
European Commission formally vetoed Thyssenkrupp (TKA.DE) merger with Tata Steel. EC claimed that a tie-up would harm the competition as the combined entity would have too big market share. Nevertheless, the two companies expected the Commission to ask for more concessions and decided to drop plans for the merger some time ago. Companies said that offering more concessions would make the deal illogical.
DAX members at 8:56 am BST. Source: Bloomberg
Infineon Technologies (IFX.DE) shares may be more active throughout today’s session. Rumours surfaced saying that Apple (AAPL.US) is still interested in buying Intel’s (INTC.US) German smartphone modem unit. Little details are known so far. In case the deal goes through one could expect Apple’s suppliers, like Infineon, to react to the news.
KKR, the US private equity investor, offered to buy shares of Axel Springer’s (SPR.DE) minority shareholders. The company offered a price of 63 cents per share, representing a 40% premium over pre-announcement market price. However, the offer will not be valid in case less than 20% of Springer’s shareholders express interest in it.
Infineon Technologies (IFX.DE) stock price plummeted over the past two weeks as markets become concerned that Apple, one of Infineon’s major clients, will become a subject in US-China trade spat. Price dipped to the lowest level since September 2016 but managed to recoup part of losses and may be eyeing a test of the €15.75 handle. Source: xStation5
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