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DE30 weakens after false breakout above 13,450 points barrier
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Investor attention focused on Taiwan
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Siemens Energy (ENR.DE) under pressure from weak forecasts for Siemens Gamesa (SGRE.ES)
Market sentiment during this week's last trading session on European trading floors is overwhelmingly negative. The German DE30 is down 0.81%, the French FRA40 is losing 0.76%, and the Polish W20 is losing 0.59%.
The economic calendar today is relatively empty, and the only noteworthy readings were/are: RBA interest rate decision (now 1.85%, forecast 1.85%, earlier 1.35%), Swiss Manufacturing PMI Index (now 58, forecast 55.8, earlier 59.1) and change in oil inventories according to API (forecast: -0.4 brk, earlier -4.04 brk). The key event of the day is Nancy Pelosi's visit to Taiwan, which raises concerns about more intensive tensions on the US-China line. Moreover, Germany's Foreign Minister communicated that Germany would support Taiwan in the event of Chinese aggression.
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DE30 index chart, H4 interval. The blue-chip benchmark is seeing declines today and is breaking out below the 13,450-point zone. From a technical point of view, the closest supports are the previously mentioned exponential, moving averages (blue, purple and gold curves). The psychological level of 13,000 points also remains an important point. The most important resistance now remains the previously mentioned barrier of 13,450 points. Source: xStaton 5
News:
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Investors' attention was captured today by the situation around Siemens Energy (ENR.DE) and Siemens Gamesa (SGRE.ES), where the subsidiary lowered its forecasts for revenue (to -9% from the previously forecast range of -2%,-9%) and EBIT margin (to -5.5% from the previously forecast range of -4%,+1%). In the third quarter, EBIT fell to -343 million euros against forecasts of -214.2 million euros. EBIT margin fell to -14.1% against forecasts of -8.95%. Revenues fell nearly 10% y/y. Net loss reached 446 million euros against consensus of 390.3 million euros. The company cited high costs, delays, logistical difficulties and component problems as the main factors behind the loss.
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Weak sentiment is weighing on Credit Suisse (CSGN.CH), which is currently losing nearly 6%. The reason for such a large sell-off is the bank's outlook downgrade by Moody's to "negative".
Analyst's action:
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Delivery Hero (DHER.DE) with a recommendation raised to "overweight" by JP Morgan. Target price at 65 euros.
Largest percentage changes of companies included in the DAX index. Source: Bloomberg
The most active stocks in the DAX index (DE30). Source: Bloomberg
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