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European markets mixed after yesterday's rally
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DE30 pulls back below resistance at 13,125 pts
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Thyssenkrupp (TKA.DE) in talks with German government over state aid
European stock markets launched today's cash trading little changed following plunge and recovery during overnight futures trading. Investors are puzzled - positive vaccine news gives some hope that the coronavirus pandemic can be overcome but it will take time to manufacture enough doses and vaccinate a significant share of the population.
The ZEW Institute index for November has been released at 10:00 am GMT. Expectations index was expected to drop from 56.1 to 44.3 pts. However, reading showed a drop to 39 pts. Current situation index declined from -59.5 to -63.5 pts (exp. -64.3 pts). Release reflects worsening economic outlook in Europe amid renewed coronavirus restrictions.
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DE30 experienced a massive surge yesterday on the back of Pfizer/BioNTech coronavirus vaccine announcement. However, the German index jumped towards the 13,300 pts but failed to hold onto these gains and pulled back below the resistance zone at 13,125 pts that is marked by the shoulderline of the previous head and shoulders pattern. Index tested this hurdle today in the morning but failed to break above. Technical landscape supports a pullback with 12,500 pts being the first major support to watch. Source: xStation5
Company News
Deutsche Post (DPW.DE) reported Q3 results today. Company reported Q3 revenue at €16.24 billion, 4.4% YoY higher and in-line with market estimates. EBIT at €1.38 billion was 46% higher and slightly above market consensus. Post & Parcel, Global Freight and Express segments managed to grow in the period while Supply Chain segment underperformed. Q3 net income stood at €851 million and marked 52% year-over-year increase
Adidas (ADS.DE) reported Q3 revenue at €5.96 billion, 7% YoY lower but in-line with estimates. Operating profit dropped 11% YoY to €794 million while net income from continuing operations came in at €578 million (exp. €523 million). Company said that because of recent coronavirus restrictions in many countries, its store opening rate dropped to 93% (from 96% at the end of September). German sportswear manufacturer expects Q4 operating profit in €100-200 million range (exp. €283.9 million).
German economy minister confirmed that the government is in talks with Thyssenkrupp (TKA.DE) over state aid. Company and German authorities are discussing an aid package of at least €5 billion for Thyssenkrupp's steel unit. €2 billion liquidity support is discussed as well as €3 billion in grants.
DAX members at 10:12 am GMT. Delivery Hero (DHER.DE) is making a major pullback amid broad profit taking from pandemic winners. Source: Bloomberg
