DE30: Investors stay cautious amid China-US tensions

• European stocks post minor gains

• DE30 halts pullback near 50-hour moving average

• ECB may ask banks to halt dividend payments for longer

Major stock market indices from Western Europe are posting moderate gains today led by the Dutch AEX (NED25). However, in the central and eastern part of the Old Continent the situation is mixed and the majority of indices trade near yesterday's closing levels.

Rising US-China tensions are a major theme in the markets now. Two countries are shutting down each other's consulates. It is unclear at this point whether its just a periodic pick-up in tensions or are we heading for a bigger stand-off ahead of US elections. In turn, investors are in wait-and-see mode.

Source: xStation5

DE30 halted recent pullback in the vicinity of 50-hour moving average in the 13,100 pts area. The index is posting minor gains today. However, the technical situation remains unchanged. DE30 continues to trade within the Overbalance structure and unless it breaks below it (lower limit at 12,850 pts), the main trend remains upward. A break above recent short-term trading range gives hope for a return to post-pandemic highs at 13,300 pts. Nevertheless, fate of recovery may depend on developments in the China-US case and European PMIs scheduled for tomorrow. The near-term important support can be found at 13,000 pts while post-pandemic high should act as short-term resistance.

DAX members  at 10:20 am BST. Source: Bloomberg

Media reports surfaced yesterday saying that the European Central Bank is considering asking banks to halt dividend payments at least through the end of the year. This would be a hit for investors as it was expected that dividend payouts would resume in the final quarter of 2020. The ECB declined to comment.

Markus Braun, former CEO of Wirecard (WDI.DE), has been re-arrested in Germany along with two other Wirecard executives. It turns out that Braun knew about losses at the company since as early as2015. Ex-CEO was released on bail earlier.

Daimler (DAI.DE) reported a net loss of €2 billion in Q2 2020. EBIT loss stood at €1.68 billion. Revenue dropped 29% YoY to €30.18 billion while unit sales dropped 34% YoY to 541,800 vehicles. Nevertheless, the results were better than the market expected. However, the company sees positive data coming from the auto sector hinting at recovery in demand. In turn, Daimler expects a profit this year.

Tesla reported a surprise Q2 profit yesterday after the Wall Street session closed. Company's shares listed on the German stock exchange can be found under TSLA.DE ticker on xStation platform. These shares are quoted in EUR.

Daimler (DAI.DE) broke above the previous post-pandemic high at $41.50 today. However, bulls are struggling to keep the price above this level. Should we see a deeper pullback, the first support to watch can be found at $40.00. Source: xStation5