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DE30 negates early day gains
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Indices fall after Lavrov's war comments
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The drying up of the Rhine River raises concerns about production in Germany
Today's trading session on the German stock market brings a negation of the upward momentum following yesterday's news of the possible resumption of gas flows through Nord Stream 1. Uncertainty continues to be provided by the volume of these supplies and the war comments of Lavrov, the Russian foreign minister. Everything at this point seems to depend on the complexity and the timing of the completion of the maintenance work. Other stock market benchmarks from the Old Continent are also down after morning gains. The French FRA40 is losing 0.4%, the Polish W20 is up 0.09%, and the German DE30 is trading down 0.57%.
Germany's June PPI inflation came in at 32.7% on an annualized basis (consensus expected 33.9% y/y; earlier reading at 33.6% y/y).
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DE30 index chart, H4 interval. The benchmark German blue chips began today's session with moderate gains, following yesterday's rally following news of a possible favorable settlement on the topic of gas supplies from Russia. The bullish momentum, however, was negated by comments from the Russian foreign minister. From a technical point of view, the index broke out above the upper limit of the downtrend (now this area provides support for market bulls). The nearest technical resistance is now the zone of 13,430 points and 13,680 points. Source: xStation 5
News:
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BASF (BAS.DE) has given final approval for the construction of a €10 billion petrochemical plant in China's Guangdong Province (Zhanjiang City). The plant is expected to be fully operational by 2030.
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Continental (CON.DE) shares are gaining nearly 1.5% today on the release of second-quarter results. The company posted consolidated sales of 9.4 billion euros, exceeding analysts' expectations by about 200 million euros.
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Economists are also keeping a close eye on the situation on the Rhine River, which is drying up to dangerous levels. Remember that this river is a fundamental component in the transportation of coal, auto parts or food. Analysts at the Kiel Institute warn that a drop in the river's level below 78 centimeters could lead to a drop of nearly 1% in the country's industrial production. Currently, the water level is settling at 77 centimeters (data as of Monday).
Source: Bloomberg
Source: Bloomberg
Analyst's Action:
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Shares of Hypoport (HYQ.DE) rated "underperform" by Exane. Target price set at €162.
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JP Morgan maintained a "buy" recommendation on the shares of Bayer AG (BAYN.DE). Target price set at €75.
The 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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