DE30 turns positive on the year

10:23 21 July 2020
  • EU leaders conclude 4-day negotiations with a deal

  • DE30 trades positive year-to-date

  • Bayer lost Roundup case in US appeals court

Moods on the European stock exchanges are upbeat as EU leaders finally agreed on a shape of €750 billion recovery fund. Most of the blue chip indices from the Old Continent trade over 1% higher. German DAX is one of the top movers - the index gains 1.9% and has turned positive year-to-date.

Source: xStation5

DE30 is rallying today on the back of an agreement struck between EU leaders. The German index trades above the 13,135 pts area, meaning it has turned positive year-to-date. There are 2 near-term resistance levels to watch. The first one can be found at 13,500 pts handle and is marked with 2017 and 2018 highs. The second one can be found in the 13,800 pts area, where all-time high is located. Breaking to a fresh ATH would pave the way towards the 161.8% exterior Fibonacci retracement of February-March sell-off. Note that this retracement lies at around 17,550 pts therefore DAX would need to rally around 25% past its current all-time high to reach it.

DAX members at 10:03 am BST. Source: Bloomberg

Bayer (BAYN.DE) lost the first case in US appeals court related to Roundup weed killer. The court has significantly reduced the amount Bayer has to pay the plaintiff for damages. Initial court ruling said that Bayer has to pay $289.2 million, which was later increased to a stunning $2 billion! However, after the latest ruling Bayer has to pay just $20.4 million to settle this case.

According to an internal memo seen by Reuters, Thyssenkrupp (TKA.DE) plans to seek new ways to strengthen its balance sheet. Management said that proceeds from elevator unit sales will provide short relief but will not be enough for long. Company is looking into various state aid programmes.

Jan Marsalek, former COO of Wirecard (WDI.DE) and key figure in the company's collapse, remains out of reach of German prosecutors. According to Der Spiegel report, Marsalek arrived in Minsk, Belarus in the very early hours of Saturday, June 19. Wirecard announced it was missing billions of euros a day earlier.

Bayer (BAYN.DE) pulled back towards the 50% retracement of February-March drop after a failed attempt of breaking above €73.50. While the US court rejected Bayer's appeal in one Roundup case, it has greatly reduced the amount of money Bayer has to pay as damages. The stock is testing a €63.50 swing level at press time. Source: xStation5

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