DE30 holds above 13,000 pts, earnings in spotlight

• European equities struggle on Thursday

• DE30 holds above 13,000 pts

• Earnings from Thyssenkrupp, RWE and Deutsche Wohnen

European equities are trading lower after booking strong gains yesterday. DAX trades slightly above the 13,000 pts mark while UK FTSE 100 (UK100) drops more than 1% to 6,210 pts. On the other hand, Polish WIG20 (W20) builds on yesterday's gains and approaches an intraday post-pandemic high.

Source: xStation5

DE30 fully recovered from yesterday's drop and rushed to test the resistance zone ranging between 78.6% retracement of late-July correction and 13,100 pts handle. So far, the index was unable to break above this hurdle and a small pullback could be observed in early European trading today. Buyers found support at the previous local peak (13,025 pts) and may be readying to launch another upward impulse. However, for a bigger upward move towards new post-pandemic highs, a break above the 13,100 pts mark would be needed. When it comes to support level to watch, traders should focus on 12,950 pts and 12,820 pts (lower limit of the Overbalance structure).

DAX members at 10:04 am BST. Source: Bloomberg

Thyssenkrupp (TKA.DE) reported a net loss of €678 million for the second quarter of the year compared to loss of €94 million in Q2 2019. Sales dropped from €10.78 billion to €7.71 billion while orders dropped to €6.69 billion (-35% YoY). Company said that operating losses at its steel unit will reach €1 billion this year. When it comes to the calendar Q3, Thyssenkrupp expects stable performance on a quarter-on quarter basis.

Deutsche Wohnen (DWNI.DE) had a net profit of €216.7 million in the first half of 2020. This marked a 64% drop from last year's €603 million. While pretax profit dropped from €791.6 to €312.5 million, funds from operations per share were almost unchanged at €0.80 (€0.81 last year). Company said that it still expects full-year FFO per share near last year's levels

RWE (RWE.DE) reported Ebitda of €1.8 billion for the first half of 2020, marking an 18% increase from last year's level. Profit from offshore wind farms increased 20%. RWE said that it plans to further expand its renewables portfolio and commission 1.3 gigawatts of new green energy projects by the end of a year. However, RWE's Ebitda from coal and nuclear power energy projects doubled in the period. Company plans to lower the share of coal in its energy mix from 30 to 10% over the next decade.

RWE (RWE.DE) has approached pre-pandemic highs in the €34.25 area. Stock has been trading in an uptrend recently and the trendline should serve as a near-term support in case price fails to break above the aforementioned zone. Key support can be found at €31.75. Source: xStation5