DE30 breaks above key resistance in 15,400 pts area

• European stocks trade higher

• DE30 breaks above the upper limit of market geometry

• Lufthansa says Europe-US travel booking jumped 40% since ban was lifted

Stock markets in Europe are trading higher on Wednesday on the back of upbeat news on Chinese Evergrande. Main unit of Evergrande said that it will make interest payments scheduled for tomorrow. In other news, it was reported that the Chinese government may restructure the company by splitting it into 3 entities and taking control of it. This relief in China-related issues gives investors some leeway to focus on another big event of the week - FOMC decision today at 7:00 pm BST.

Source: xStation5

After a very poor start of the week, German DAX looks to be regaining ground. An important resistance area has been breached this morning. The 15,400 pts zone is marked with the 38.2% retracement of the downward move launched on August 13 as well as the upper limit of the market geometry. In theory, short-term trend has reversed and an upward move is the base case scenario now. However, a point to note is that the FOMC is set to announce a monetary policy decision tonight (7:00 pm BST). There is a lot of uncertainty around the event  so traders should keep on guard. Should the Fed announce a taper timeline, equities may feel pain and the ongoing bounce may be quickly erased.

Company News

Lufthansa (LHA.DE) said that bookings for Europe-US travel jumped 40% since the Biden administration announced that fully vaccinated Europeans will be able to travel into the United States. Shares of Lufthansa are trading over 20% lower today. However, this is not a result of any bad news but rather a price adjustment. Subscription rights for a recently announced equity offering began to trade today and today's drop in Lufthansa's share price reflects it.

Christian Scherer, Chief Commercial Officer of Airbus (AIR.DE), said that the European planemaker holds a number of talks over sales of its A350 freight aircraft. CCO also said that the order book remains strong and ensures production continues at a targeted pace, or even higher in the future.

Analysts' actions

• Bechtle (BC8.DE) downgraded to "hold" at Metzler. Price target set at €62

Bechtle (BC8.DE) is trading lower today following a downgrade at Metzler. Stock has enjoyed a steep rally in recent months, gaining over 30% off the late-June low. Upward move was halted at the 127.2% exterior retracement of the downward correction launched at the end of November 2020 and the stock pulled back into the range of the upward channel. Near-term support to watch can be found at around €63.65, where the lower limit of the channel can be found. Source: xStation5