DE30 tests 15,500 pts resistance zone ahead of CPI data

• European indices trade higher

• DE30 tests 15,500 pts resistance zone

• Puma drops after 2022 earnings miss

Stock markets in Europe are trading higher on Wednesday. Blue chips indices from major Western European economies are trading 0.6-0.9% higher today. UK FTSE 100 (UK100) and Polish WIG20 (W20) are top performers, trading around 0.9% higher each. Release of better-than-expected official PMIs for February from China boosted market sentiment. Two key macro readings left for release today are German CPI data for February at 1:00 pm GMT and US manufacturing ISM index for February at 3:00 pm GMT.

Source: xStation5

DE30 continues to trade in a short-term 15,300-15,575 pts range. The German index managed to bounce off the lower limit of the range in the 15,300 pts area recently and is now testing the 15,500 pts mark. Note that this resistance halted previous upward impulse on Monday. Note that a short-term downward trendline now runs through this resistance zone, what further boosts the significance of the 15,500 pts area. A break above would pave the way for a test of the next resistance in-line - 15,575 pts zone. Should we see a break above this hurdle as well, and therefore above the trading range, index could see an around-275 points jump (textbook range of a breakout from this trading range).

DAX members on Wednesday. Source: Bloomberg

Company News

Puma (PUM.DE) reported full-year results this morning. Report came in mixed with revenue beating expectations and . Sales increased 24% YoY to €2.20 billion (exp. €2.13 billion), driven by a massive beat in footwear sales (€1.18 billion vs. €0.8 billion expected). Gross profit increased 14% YoY to €967.3 million (exp. €973 million) while EBIT was 38% YoY lower at €40.5 billion (exp. €42.8 million). Net income was 82% YoY lower at €1.4 million (exp. €6.86 million), and translated into EPS of €0.01 (exp. €0.03). Puma declared dividend per share of €0.82

Beiersdorf (BEI.DE) reported full-year results this morning that were mostly in-line with market expectations. Sales climbed 15% YoY to €8.80 billion (exp. €8.79 billion). Adjusted EBIT reached €1.16 billion (exp. €1.16 billion) while R&D expenses came in at €291 million (exp. €294.5 million). Dividend per share was declared at €0.70.

RBC reports that Volkswagen (VOW1.DE) is close to selling its last plant in Russia. Avilon, a major auto dealership holdings in Russia, is said to be the main bidder for a facility located in Kaluga, Russia. Approval of the deal is expected as soon as March 3, 2023.

ProsiebenSat.1 Media (PSM.DE) announced that it is postponing presentation of full-2022 financial statements due to regulatory matters related to two of its subsidiaries. Company warned that the Annual General Meeting may also be postponed.

Analyst Recommendations

• Siemens Energy (ENR.DE) upgraded to "overweight" at JPMorgan. Price target set at €25.00

• Aixtron (AIXA.DE) upgraded to "buy" at Deutsche Bank. Price target set at €34.00

• Fielmann (FIE.DE) upgraded to "buy" at Baader Bank. Price target set at €41.00

Puma (PUM.DE) is trading lower today following an earnings miss. Bears are trying to push the stock below an important support zone marked with 200-session moving average (purple line) as well as 23.6% retracement of the downward move launched in November 2021. Breaking below this hurdle would put the fate of the ongoing upward correction under serious question. Source: xStation5