DE40: German index breaks below key support zone 💡

European stock indices are recording significant declines during Thursday's trading session. DE40 contracts are currently down more than 1.23%, while EU50 is down 0.85%. On the data side, investors' attention will focus on numerous speeches by Fed bankers and US GDP data. Data on durable goods orders may also prove important.

The German DE40 index is down 1.1% in today's session and is once again trying to break below the support zone marked by the 100-day exponential moving average (purple curve on the chart). As long as the DE40 remains above these zones, the overall upward trend (medium-term) remains sustainable in the longer term. The RSI for the last 14 days is trading at levels close to 46 points, which may indicate that current prices remain relatively close to the average dynamics of the last 14 sessions. However, it is important to note that the 50-day EMA is tilting downward, which may indicate that the short-term trend has changed to downward. It may be crucial whether today's decline closes permanently below the 100-day EMA. Such a scenario would further undermine the current long-term upward trend. Source: xStation

Company news

H&M (HMB.SE) reported Q3 2025 results well above market expectations, which translated into a 12% jump in its share price, the strongest move since March 2024. The key factor was an increase in gross margin, supported by favorable purchasing and exchange rate effects, as well as better control of operating costs. EBIT exceeded forecasts by 33%, which, according to Jefferies, may suggest that the consensus for Q4 needs to be revised upwards, even though the company forecasts flat sales in September y/y. RBC notes that the higher gross margin was also due to lower COGS, although cautious forecasts for Q4 may reflect the impact of US tariffs. Operating profit and gross profit were significantly better than consensus, with stable sales against a high base from last year. H&M continues to optimize its network by closing less profitable stores, mainly Monki, and opening more than 80 new stores in growth markets in 2025. At the same time, the company highlights the positive reception of its fall collection and improved supply chain flexibility. Slightly higher sales costs in Q4 are expected due to an earlier Black Friday and a higher share of purchases from the current season. The management board assesses the inventory structure positively, seeing it as another area for improving profitability. The company continues to monitor its commercial policy and the risks associated with global restrictions, which is particularly important given its high exposure to international markets.

Key results vs. expectations

• Operating profit (EBIT): SEK 4.91 billion vs. expected SEK 3.74 billion
• Gross profit: SEK 30.14 billion vs. expected SEK 29.42 billion
• Gross margin: 52.9% vs. expected 51.4%
• Profit before tax: SEK 4.32 billion vs. expected SEK 3.29 billion
• Revenue: SEK 57.02 billion vs. expected SEK 57.12 billion
• Operating margin: 8.6% vs. expected 6.55%

Source: xStation

LVMH (MC.FR) plans to significantly increase its presence in South Korea, treating this market as a safe haven amid the slowdown in the US and China. Louis Vuitton and Dior plan to expand their flagship stores in Seoul, with Dior also opening a restaurant, while Bulgari and Tiffany are preparing their own boutiques in the coming years. Thanks to its strong economy, high consumption of luxury goods, and influx of tourists, Korea has become one of the most important luxury markets in the world. In 2024, sales of Louis Vuitton, Hermès, and Chanel in the country increased by nearly 10%, and tourist spending reached a record 9.26 trillion won.

Following today's announcement that the US has launched an investigation into imports of robots, machinery, and medical devices, the market immediately reacted with sharp declines. Healthcare and industrial companies were hit hardest, particularly Siemens Healthineers (SHL.DE) and Philips (PHIA.NL). The investigation could result in tariffs being imposed on a wide range of products, raising concerns about increased operating costs and reduced competitiveness for European manufacturers in the key US market. The Trump administration's trade policy has already caused global uncertainty and supply chain disruptions, and further moves in the form of new tariffs could translate into higher medical equipment prices and potential shortages in the US. Investors are also concerned about the indirect effects on other industries, as a possible escalation of the trade war will affect the entire European industry and export sector.

Source: xStation

Other information from German companies included in the DAX index. Source: Bloomberg Financial LP