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European markets trim early gains
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DE30 pulls back to 13,950 pts price zone
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Bayer proposed lower dividend for 2020
Stock markets in Europe launched today's trading higher following gains made by Wall Street and Asia indices. However, some indices have already erased most of the gains. German DAX is trading more or less flat on the day while other indices from the Western Europe trade 0.3-0.4% higher. Spanish, Portuguese and Polish indices are outperformers as they trade around 1% higher.
Source: xStation5
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Create account Try a demo Download mobile app Download mobile appDE30 managed to break above the 200-hour moving average (purple line) yesterday and rallied towards the 14,080 pts swing level during today's Asian session. However, once again we have seen a strong downward move following the European cash session open. DE30 pulled back to the zone ranging between 13,950 and 23.6% retracement of the upward move started at the end of January. Breaking below this zone and the lower limit of the Overbalance structure (yellow box) could be seen as a warning sign but until it happens, decline can be viewed as a correction in the current impulse. A point to note is that European markets often slumped at the beginning of the cash trading this week but recovered later on as the session progressed. In case we see a start of a recovery move today as well, the first near-term resistance to watch can be found at 14,025 pts.
DAX members at 9:54 am GMT. Source: Bloomberg
Company News
Bayer (BAYN.DE) reported Q4 2020 sales at €10 billion, a drop of 7% YoY (exp. €10.12 billion). Adjusted EBITDA in the period reached €2.39 billion, a drop of 3.4% YoY (exp. €2.49 billion). Net income declined 78% YoY to €308 million. Company generated a negative free cash flow of €503 million. 2020 dividend was proposed at €2.00 per share, compared to €2.80 in 2019. Bayer expects 2021 adjusted EBITDA in €11.2-11.5 billion range with sales at €42-43 billion. Company also said that it may withdraw from some Roundup settlement deals if participation rates are not satisfied.
Munich Re (MUV2.DE) reported full-2020 results today. German reinsurer experienced a 42% YoY decline in operating profit to €1.99 billion (exp. €1.93 billion). Net income declined 55% YoY to 1.21 billion. Combined ratio came in at 105.6% (exp. 106%). Company proposed unchanged dividend per share at €9.80. Munich Re expects 2021 profit at €2.8 billion with reinsurance profit coming in at €.3 billion. Combined ratio is expected to drop to around 96%.
SAP (SAP.DE) proposed a 17% increase in 2020 dividend. Payout was proposed to be increased by €0.27 to €1.85 per share. Proposal is conditional on shareholders' approval.
Bayer (BAYN.DE) is dropping today following a mixed earnings report for Q4 2020 as well as news that some Roundup cases may not be included in settlement deals. Stock is pulling back from the 200-session moving average (purple line) and the €55.50 resistance zone. A near-term support to watch is marked with the upward trendline. Breaking below may pave the way for a deeper decline. Source: xStation5
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