DE30 trims gains after opening higher

• Equity indices trade higher on the back of Kudlow’s comments

• DE30 tries to cover upward price gap at the beginning of a cash session

• Wirecard (WDI.DE) increases employment in compliance department after accounting scandals

Stocks around the world are benefiting from Kudlow’s comments. The White House economic adviser said that the United States and China are closing in on the “Phase One” trade agreement. European stocks are no exception as bulls dominate beginning of Friday’s session. The biggest gains could be spotted on the Swiss and Spanish stock exchanges in the first minutes of trade.

Source: xStation5

Situation on the DE30 chart remains unchanged. The index continues to trade in the 13160-13300 pts range. The lower limit was being tested yesterday but bears failed to deliver a break lower. Following today’s higher opening the index return to the upper part of the range. However, the index took quite a significant dive following the opening of today’s cash session. DE30 attempts to break below the key support zone - combination of 50-, 100-hour moving averages and the 13220 pts swing level. Should it succeed, the 200-hour moving average (purple line, 13175 pts area) could be at risk. Note that this moving average strengthened the lower limit of the trading range recently and helped the index bounce higher (orange circle). The key support remains unchanged at the lower limit of the Overbalance structure (yellow box, 13065 pts).

Almost every DAX member is trading higher at the beginning of Friday’s session. Risk-on moods boost valuations of trade-sensitive stocks like carmakers or Infineon Technologies. Source: Bloomberg

Ola Kallenius, CEO of Daimler (DAI.DE), warned that a shift towards EV and autonomous cars will be a hard time for the company. The transition will be costly and Daimler’s profits are likely to remain under pressure for the next two years. Executive plans to gradually improve margins by capping investments and slashing jobs. The plan was outlined during the strategy presentation. However, the market seems to be disappointed as the word on the street is that the presentation was too general and lacked essence.

Wirecard (WDI.DE) is learning lessons from the accounting scandals. Chief Financial Officer of Wirecard, Alexander Von Knoop, said that the company increased employment in its compliance department by around 50% this year. Moreover, the company decided to split compliance and legal department into separate units.

Merck (MRK.DE) is trading higher today and tries to recover from yesterday’s post-earnings plunge. The company received a recommendation from Bankhaus Lampe. The company was rated “hold” and price target was set at €113.

Merck (MRK.DE) plunged yesterday following the release of the Q3 earnings report. The sell-off was halted at the 50-session moving average (green line). The stock is trying to recover today producing a solid upward move. Key support to watch can be found at €103.35 - the lower limit of the Overbalance structure (yellow box) and the local low from late-October. Near-term resistance is located at the YTD high (€110.10). Source: xStation5