DE40: German DAX opens at all time high, Commerzbank shares gain

• German DAX opened at record levels
• Commerzbank shares higher after announcement to increase profitability
• BASF SE is cutting its dividend and preparing to hive off assets

General market situation: European markets continue gains on Thursday. The German DAX is currently up 1.1% just like the Spanish IBEX35. At the same time, the French CAC40 is gaining 1.5%. The DAX is extending all-time-high levels. Investors' attention will be mostly focused on US data. Today the Swiss National Bank has decided to lower interest rates by 25 basis points.

Volatility is currently observed in the broader European market. Source: xStation

The German DE40 index is trading at all-time-high levels. The current question is whether the DAX will be able to remain at this level. The first support is located at the previous high of 19032.8. The next key support may be the mid-July peak at 18,861. Breaking those two levels would open the door for bears to test the 23.6% support or even the 50- and 100-day SMAs. Currently, oscillators are giving bulls ground for further upside, with the MACD increasing and the RSI consolidating near oversold levels. However they are approaching oversold levels which might make investors cautious. Source: xStation

News

• SMA Solar Technology (S92.DE) has initiated a restructuring and transformation program with a target of cost savings between €150 million to €200 million. The company reports that sales development in its Home Solutions and Commercial & Industrial Solutions segments continues to be significantly influenced by persistently high inventories at distributors and installers, as well as a challenging market environment. However, the Large Scale & Project Solutions segment continues to develop according to plan. The restructuring measures include optimizing the cost structure and changing the organizational structure and processes.
• Siemens Energy AG (ENR.DE) has extended the contract of Chief Executive Officer Christian Bruch for five years, until April 2030. This decision comes as the company seeks to deliver on its turnaround plan after troubles at its Spanish wind-turbine business, Gamesa. Siemens Energy recently increased its cash flow outlook due to growing demand for grid technologies and gas services. The company's shares have recovered significantly, up about 180% this year after plunging in 2023. Siemens now expects Gamesa to break even from 2026, which the chairman described as completing "one of the largest restructuring projects in Siemens' history."
• BASF SE (BAS.DE) has announced a broad overhaul of its operations, including cutting its dividend and preparing to hive off assets. The company is considering listing its agricultural unit, which reported about €10 billion in sales last year. BASF is also weighing additional closures at its Ludwigshafen site, Europe's biggest chemical plant, as part of a plan to cut annual costs by €2.1 billion by the end of 2026. The dividend will be reduced to at least €2.25 per share, the lowest in more than a decade. BASF is targeting a share buyback of around €4 billion from 2027, resulting in total payouts to shareholders of at least €12 billion between next year and 2028. The company has set new mid-term financial targets for 2028, aiming for a return on capital of around 10% and earnings of €10 billion to €12 billion before interest, taxes, depreciation, appreciation and special items.
• Commerzbank AG (CBK.DE) Commerzbank shares jumped 5.6%, making it the best-performing stock on the Stoxx 600 Banks Index. The German lender has pledged to increase profitability and pay out more money to investors. Commerzbank expects net profit to rise significantly to over €3 billion in 2027 and aims for payout ratios of more than 90% for the years 2025 to 2027. The bank's management is set to meet with UniCredit on Friday, which may be contributing to investor optimism. However, Bloomberg Intelligence analysts note that the new targets are "challenging to achieve," with the raised revenue promise and cost-to-income goal described as ambitious.

Other news coming from individual DAX index companies. Source: Bloomberg Financial LP