European stocks under pressure at the start of the week; UBS reassesses capital markets companies

• DE30 in slightly worse mood at start of week
• UBS sees potential in European listed stock exchange operators
• Carl Zeiss Meditec wants to expand its ophthalmology portfolio

General market situation:

Monday's session on European stock markets brings mixed sentiment among investors. Quotations of the German DAX and DE30 contracts show intraday declines. The European benchmark Euro Stoxx 50 is currently losing nearly 0.36%. The macro calendar for today's session is relatively empty, nevertheless, volatility in the markets may increase somewhat tomorrow, when we will learn the BoJ decision and the RBA Minute.

IFO data: 

• Business Climate: 86.4 vs. expected 87.7 (87.3 previously)
• Expectations: 84.3 vs. expected 85.6 (85.2 previously)
• Current conditions: 88.5 vs. expected 89.5 (89.4 previously)

Ifo is clearly disappointing, looking at expectations. The bottom in the economic cycle may have been reached, but it certainly won't be a clear and sudden rebound, and a prolonged slump is in the pipeline. Looking at the details of the report, the big problem is the continued high price pressure (although still reduced looking at 2022 and early 2023). 

European companies traded during Monday's trading session are mostly down at the moment. Source: xStation 5

Germany's benchmark DAX is losing nearly 0.12% during today's session. The index is trading at all-time highs. The main support level may now be the zone of local peaks from May, June and July this year. On the other hand, the short-term resistance level may now be the level of historical peaks at 17080 points.  Source: xStation 5

News:

UBS Bank has rated Deutsche Borse (DB1.DE) shares at "buy" with a target price of €210. That's not all, however, as the Swiss bank is optimistic about all European stock market operators, including Euronext (ENX.FR) and the London Stock Exchange (LSEG.UK). The investment bank's experts justify their optimism for 2024 in particular by the sector rotation from bank stocks to the exchange operators they expect in 2024.

Source: the stocks of the aforementioned companies are seeing relatively sizable rallies today. Source: xStation

Bayer (BAYN.DE) shares are trading under downward pressure today, having been negatively rated by HSBC bank. The institution's analysts downgraded the stock to a "reduce" rating from an earlier "hold." The target price was set at 25 euros. The recent fiasco in research on the promising drug Asundexian has put pressure on the stock price. In addition, litigation over glyphosate and PCBs in the U.S. poses further potential risks worth billions, analysts added.

Carl Zeiss Meditec (AFX.DE) shares rose 1.5% after news that it wants to expand its ophthalmology portfolio and acquire the Dutch Ophthalmic Research Center (Dorc) for €985 million.

Analyst recommendations:

* Symrise (SY1.DE): Warburg Research reiterates Neutral rating on the company's shares; target price at €100. 

* Munich Re (MUV2.DE): Barclays reiterates "buy" rating on the company's shares and raises target price to €439 per share vs. previous rating of €428 per share.