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European indices trade lower
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DE30 tests short-term upward trendline
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Adidas to be removed from Euro Stoxx 50 index
Majority of the European stock market indices trade lower on Tuesday. Polish WIG20 (W20) is a top laggard with a 1.6% drop at press time. German DAX (DE30) and Italian FTSE MIB (ITA40) are top laggards in Western Europe, dropping around 0.9% each. Equities from Portugal and Switzerland buck the trend and post small gains.
Germany factory orders data for April was released at 7:00 am BST today and showed an unexpected drop. While orders were expected to increase 0.4% MoM, the actual report showed a drop of 2.7% MoM. German statistics office commented that while demand has already been weakened by uncertainty resulting from the Russia-Ukraine war, this weakness magnified in April due to lockdowns in China. However, the office said that while order inflow weakened, order books of German companies remain well filled.
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Source: xStation5
DE30 managed to climb above the 14,600 pts resistance zone on a third attempt but bulls failed to hold onto those gains. Index reversed after testing 14,700 pts area and pulled back below the aforementioned price zone. A test of the short-term upward trendline can be observed at press time and should bears push the index below, downward move may deepen towards 14,310-14,350 pts support zone. However, a key near-term support can be found around 200 points lower at 14,125 pts. This is where the lower limit of the local market geometry can be found. In theory, a break below 14,125 pts would signal a reversal of the short-term trend.
Company News
According to a Financial Times report, Deutsche Bank (DBK.DE) has moved hundreds of IT workers and their families from Russia to a growing technology hub in Berlin, Germany. It is said that around a half of the bank's 1,500 IT workforce in Russia has accepted the offer while hundreds more expressed interest in the move.
Qontigo, an index provided, announced that Adidas (ADS.DE) will be removed from Euro Stoxx 50 (EU50) and Global 150 indices, effective June 20. Company will be replaced by Glencore in both indices. Adidas drops around 1% on the news.
Adidas (ADS.DE) pulled back slightly after Qontigo announced the company will be removed from Euro Stoxx 50 and Global 150 indices. Stock has recently bounced off pandemic lows but recovery was halted by the €190 resistance zone. Note that the 50-session moving average (green line) is acting as a kind of ceiling for the stock. Source: xStation5
