- German DAX continues losing streak
- BMW Uncovers Russian Export Irregularities
- Deutsche Bank Securities Settles SEC Investigation
- Merck Finalizes LaNova Medicines Agreement
General market situation: European markets are trading mostly lower, with the Spanish SPA35 showing the largest decline (-0.63%), followed by the Dutch NED25 (-0.59%) and the pan-European EU50 (-0.47%). The French FRA40 and Italian ITA40 are both down 0.40%, while the UK's UK100 (-0.31%) and German DE40 (-0.30%) show more modest losses. In contrast, the Swiss SUI20 (+0.01%), Austrian AUT20 (+0.03%), and Polish W20 (+0.67%) are trading in positive territory.
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Dax Returns by Sector. Source: Bloomberg Financial LP
Looking at the German DAX sector performance, only Financials (+0.18%) and Industrials (+0.08%) are trading in positive territory. Health Care shows the steepest decline (-0.76%), followed by Consumer Staples (-0.64%) and Consumer Discretionary (-0.54%). Information Technology (-0.38%), Materials (-0.35%), and Real Estate (-0.17%) are also down significantly. Communication Services (-0.07%) and Utilities (-0.11%) show more modest declines. The aggregate DAX performance shows a decline of 0.15%, with market breadth negative as eight out of ten sectors trade lower.
Volatility is currently observed in the broader European market. Source: xStation
The German DE40 Index is continuing its downtrend. The RSI has cooled down and is starting bearish divergence. Additionally, the MACD, after forming a bearish crossover, is widening to the downside.
For bears, a retest of the October high at 19,783 could accelerate the downward momentum. A decisive break below this level could lead to a retest of the early November high at 19,525, which aligns closely with the 50-day SMA at 19,653, establishing a critical support zone.
For bulls, the 161.8% Fibonacci retracement level at 20,566 remains the key resistance. This level has played a pivotal role in recent sessions and could act as either a springboard for further bullish advances or a threshold marking the onset of bearish divergence. Source: xStation
Corporate News
- BMW (BMW.DE) Uncovers Russian Export Irregularities - BMW has discovered unauthorized exports of over 100 high-end vehicles to Russia through its Hanover branch, leading to immediate termination of involved personnel and export suspension. While BMW affirms its compliance with EU and US sanctions, the company acknowledges the broader industry challenge of "grey imports" reaching Russia despite embargo measures. The luxury automaker is implementing additional controls to prevent unauthorized distribution channels.
- Deutsche Bank Securities (DBK.DE) Settles SEC Investigation - The broker-dealer subsidiary has agreed to pay $4 million to resolve SEC allegations regarding delayed suspicious activity reporting. The investigation revealed instances where the firm took over two years to file reports, including one case involving 68 suspicious transactions totaling nearly $2 billion. Deutsche Bank emphasized its cooperation with regulators and prior implementation of remedial measures.
- Volkswagen (VOW1.DE) Reaches Landmark Union Agreement - The automaker has concluded negotiations with IG Metall, securing a comprehensive restructuring deal that guarantees German factory operations through 2030 while planning for 35,000 job reductions through attrition. The agreement includes union concessions on wage increases until 2031 and production cuts, reflecting broader challenges in the German automotive sector amid economic headwinds and increasing Chinese competition.
- Merck (MRK.DE) Finalizes LaNova Medicines Agreement - The company has completed its exclusive global licensing deal for LM-299, a PD-1/VEGF bispecific antibody. Merck will record a Q4 2024 charge of $588M (18 cents per share) for the upfront payment, with potential additional milestone payments of up to $2.7B. The agreement includes a $300M technology transfer payment expected in 2025.
Other news coming from individual DAX index companies. Source: Bloomberg Financial LP
