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European markets trade near Friday's closing prices
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DE30 attempts to break above 15,310 pts price zone
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Volkswagen expects hit from chip shortage in Q2
European stock markets launched today's cash session flat or in some cases slightly higher. Session has been calm so far and major indices from the Old Continent traded in tight ranges around Friday's closing prices so far. Spanish IBEX (SPA35) is European top performer as it trades 0.9% higher. Dutch AEX (NED25) lags, trading almost 0.4% lower.
German IFO index for April was released at 9:00 am BST. Headline business climate index moved from 96.6 in March to 96.8 in April while market expected jump to 97.7 Expectations subindex reached 99.5 (exp. 101.2, prev. 100.3) while Current Assessment subindex came in at 94.1 (exp. 94.4, prev. 93.1). While data missed market's estimates, reading did not show any major changes from the previous month in general.
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Source: xStation5
DE30 continues to struggle to hold above the 15,310 pts price zone. Index broke above this zone this morning but has pulled back below later on. Pullback was halted at the 50- and 200-period moving average (M30 interval) and now the index is trying to break above the 15,310 pts zone once again. Should DE30 break above it, the next target for bulls can be found at 15,360 pts, where the 61.8% Fibonacci retracement of a recent correction is located.
Company News
According to the Financial Times report, Volkswagen (VOW1.DE) warned managers to prepare for large production delays and halt in the second quarter due to shortages on the global chip market. According to company's executives, chip shortage is the biggest problem Volkswagen faces right now and Q2 may be worse than Q1. Similar remarks were made by Daimler executives last week.
Analyst actions
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SAP (SAP.DE) rated "buy" at Goldman Sachs. Price target set at €135
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Continental (CON.DE) rated "buy" at JPMorgan. Price target set at €150
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Daimler (DAI.DE) rated "buy" at JPMorgan. Price target set at €100
Daimler (DAI.DE) dropped over 7% off a recent post-pandemic high. However, pullback was halted at the short-term upward trendline. Key near-term resistance levels to watch are €74.35 (38.2% retracement) and €75.06 (50% retracement). Stock failed to break above those levels and now is heading towards support at €73. Source: xStation5
