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European markets trade lower
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DE30 climbs back above 15,000 pts
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Travel-related stocks slump on restrictions fears
European stock markets are trading lower on Tuesday as investors remain concerned about the new coronavirus variant Omicron. Major stock market indices from the Old Continent trade over 1% lower with Spanish IBEX (SPA35) being top laggard (-1.7%). Russian and Polish equities look to be the most resilient with blue chips indices from those countries trading "only" 0.5-0.7% below yesterday's cash session closing prices.
Source: xStation5
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Create account Try a demo Download mobile app Download mobile appComments from Moderna CEO on possible ineffectiveness of currently available vaccines against Omicron variant triggered a new wave of selling in the markets. DE30 is trading around 1.7% lower on the day and is once again testing the lower limit of a local market geometry at 15,070 pts, marking equality with the August-October 2021 correction. Note that this zone is also strengthened by previous price reactions and 23.6% retracement of the upward impulse launched after US presidential elections in November 2020. Plunging below this level would, in theory, hint at a reversal of short-term trend. If this is so, the next major support level to watch can be found around 6% below current market price at 14,180 pts - this zone is marked with the level limit of the large Overbalance structure and previous price reactions.
Company News
Travel-related stocks are once again trading under significant pressure. Comments from Moderna CEO suggested that current vaccines may be ineffective against Omicron coronavirus variant. Having said that, new restrictions on travelling may be required to prevent spreading of a new mutation. Fraport (FRA.DE), Airbus (AIR.DE), Lufthansa (LHA.DE) and TUI (TUI.DE) are dropping today.
According to Sueddeutsche Zeitung report, Allianz (ALV.DE) is set to agree on a new long-term contract with Commerzbank (CBK.DE). Under the new contract, Commerzbank would continue to offer Allianz products to its clients in exchange for a single payment of €150-200 million. Newspaper claims that commission on insurance products sold could amount to over €1 billion over a 10-year period. Current agreement between Allianz and Commerzbank is set to expire in 2023.
Analysts' actions
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KION Group (KGX.DE) upgraded to "buy" at Societe Generale. Price target set at €112.00
In spite of Sueddeutsche Zeitung report on Allianz and Commezbank closing in on new agreement, shares of Allianz (ALV.DE) are trading lower today. Stock is testing mid-term support zone ranging between €190 handle and 61.8% retracement of the 2020 pandemic drop. This zone has been limited downward moves over the past year and breaking below it would pave the way for a test of the support zone marked with 50% retracement (€175.00). Source: xStation5
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