-
Stocks in Europe trade lower
-
DE30 pulls back from 61.8% retracement
-
Siemens confirms plans to separate another unit
European stock markets are trading lower at the beginning of a new week. Blue chips indices from Western Europe dropped over 0.5% with French CAC 40 (FRA40) declining over 0.7% and being top underperformers. Polish WIG20 (W20) is a top performing European blue chips index today with a 0.6% gain at press time.
German coalition talks are slowly progressing. SPD, Greens and Free Democrats reached a preliminary agreement last week to enter coalition talks with consent being required from each party's congress. SPD and Greens have already green-lighted talks this week while Free Democrats are expected to vote on it today. Three parties say they have no plans to increase taxes. They will also work on climate and plan to increase minimum wage to €12 per hour during the first year of the new government.
Start investing today or test a free demo
Create account Try a demo Download mobile app Download mobile app
Source: xStation5
DE30 reached 61.8% retracement of the downward correction started in August at the end of a previous week. However, the index struggled in the area on Friday and a strong pullback can be spotted today. Note that the upper limit of the Overbalance structure can also be found near the 61.8% retracement and a break above it would be needed to talk about trend reversal. The first near-term support to watch in case the ongoing pullback deepens is the 200-period moving average (H4 interval, purple line) that can be found near 15,460 pts. There are no major data releases scheduled for today and the earnings calendar is rather empty as well. Having said that, traders should be aware that today's trading may be dominated by headlines and sentiment.
Company News
Siemens (SIE.DE) confirmed recent media reports and said it indeed plans to separate a unit that focuses on large drive applications. The aim is to divest the unit following a separation. According to Handelsblatt, more than 7 thousand employees will be affected by the decision.
Leonardo, an Italian defence company, said that Airbus (AIR.DE) was not supplied with parts from Manufacturing Process Specification, a subcontractor whose faulty products were found in Boeing planes last week. Concerns arose as MPS is listed as an approved supplier of Airbus.
A two-week production halt was launched today at Skoda Auto owned by Volkswagen (VOW1.DE). Decision was taken because of semiconductor shortage. Halt will relate to new vehicle production as Skoda aims to complete 10 thousand yet unfinished cars during the period.
Siemens (SIE.DE) is trading little changed in spite of confirming the next step in its restructuring. Stock has bounced off the upward trendline and a 200-session moving average last week. However, upward move was halted slightly below 50-session moving average (green line) and stock struggles to break above it. Should bulls manage to push price above this hurdle, a test of the €144 resistance area could come next. Source: xStation5
This content has been created by XTB S.A. This service is provided by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, entered in the register of entrepreneurs of the National Court Register (Krajowy Rejestr Sądowy) conducted by District Court for the Capital City of Warsaw, XII Commercial Division of the National Court Register under KRS number 0000217580, REGON number 015803782 and Tax Identification Number (NIP) 527-24-43-955, with the fully paid up share capital in the amount of PLN 5.869.181,75. XTB S.A. conducts brokerage activities on the basis of the license granted by Polish Securities and Exchange Commission on 8th November 2005 No. DDM-M-4021-57-1/2005 and is supervised by Polish Supervision Authority.
