DE30 tests 50-hour moving average near 15,700 pts

• Stocks in Europe trade higher

• DE30 tested 50-hour moving average near 15,700 pts

• Wacker Chemie (WCH.DE) boosted full-year forecasts

Following a mixed opening of today's cash session in Europe, most of the major stock benchmarks from the Old Continent moved higher. Indices from Germany, UK, France, Spain, Italy and the Netherlands all trade over 0.5% higher. Indices from Russia and Portugal are the only ones to trade lower. While gains can be seen as a positive, a point to note is that most of the European blue chips indices trade in tight ranges and await a catalyst for a big move.

Source: xStation5

DE30 dipped below the 50-hour moving average yesterday, that served as a short-term support for the index. However, bears were unable to break below a more important support marked with the 38.2% retracement of the upward move launched in mid-July (15,650 pts). An indecisiveness can be spotted on the market with neither bulls, nor bears being strong even to break out of the trading range marked with 23.6% and 38.2% retracements. The aforementioned 50-hour moving average (green line) along with the 200-hour moving average (purple line) serve as swing levels. Today's US retail sales report release may lead to an elevated volatility on the equity markets but we might have to wait until next week's FOMC meeting for a trigger for a big move.

Company News

Shares of Continental (CON.DE) are trading around 14% lower today. However, the drop was not caused by any sort of bad news but is more of a technical nature. The German automotive company spun-off its powertrains unit Vitesco. Shareholders received 1 Vitesco Technologies share for every 5 shares of Continental they owned.

Wacker Chemie (WCH.DE) boosted full-year forecasts for 2021. Company now expects full-year sales to reach around €6 billion, up from a previous forecast of €5.5 billion. EBITDA is expected to come in between €1.2 billion and €1.4 billion, up from €0.9-1.1 billion. Wacker Chemie expects Q3 sales around €1.6 billion and Q3 EBITDA at €400 million. Boost in forecasts is reasoned with higher polysilicon prices and strong demand.

Suedzucker (SZU.DE) reported a 25% YoY increase in operating profit in June-August period (fiscal Q2), to around €85 million. Sales were 10% YoY higher at €1.84 billion. Quarterly operating profit in the sugar business reached €7 million, up from a €42million loss a year ago. Company said that it still expects full fiscal year operating profit in sugar unit to reach €0-100 million while at the group level the company expects operating profit of €300-400 million.

Suedzucker (SZU.DE) trades little changed on the day after erasing most of the early gains. Company reported solid results and upheld its forecasts for full fiscal year but investors do not seem impressed. Two near-term levels to watch are upward trendline (support) and €14.50 area (resistance). Source: xStation5