DE40: Negative Sentiment Dominates European Stock Markets

European indices are slightly down today. The German DE40 is losing around 1%, the Spanish SPA35 has dropped nearly 1.2%, and the British UK100 is also down by close to 0.8%. Markets in Switzerland, the Netherlands, and Italy are also underperforming slightly, with indices falling by a few tenths of a percent.

These market moves coincide with mixed macroeconomic data from the Eurozone, which has created a more varied market sentiment. Industrial production for July rose moderately by 0.3% month-over-month, which represents a rebound after previous declines, though analysts had expected a 0.4% increase. On a yearly basis, industrial production grew by 1.8%, slightly beating analysts’ expectations. Meanwhile, wage growth accelerated to 3.7% year-over-year, which could increase inflationary pressure and potentially influence the European Central Bank’s (ECB) future decisions. Investor optimism is further supported by an increase in the ZEW index, especially in Germany, where sentiment improved to 37.3.

Despite the positive signals from industry and growing optimism, markets remain cautious and are awaiting further data and ECB communications. Additionally, investors are closely watching the upcoming decisions from the U.S. Federal Reserve (Fed), which could have a significant impact on global markets and the future direction of monetary policy.

Source: xStation

Current volatility in the broader European market.
Source: xStation

DAX is falling during today’s session and is hovering around the 100-day exponential moving average, which is currently serving as a key support level. This is an important area that may determine the market's next direction—if it holds, there's a chance for a rebound and continued upward movement. However, a break below this support could signal worsening sentiment and lead to further declines. Investors are closely watching this zone, as the coming days will be crucial for European indices.

Source: xStation

Company News:

Puma (PUM.DE) is up as much as 4.8% today amid media speculation that its domestic competitor, Adidas, may be interested in acquiring the brand. These rumors emerged following a report in Handelsblatt, where one of Puma’s shareholders suggested that a merger with Adidas could be the best option if Puma fails to improve its performance independently. Adidas has so far declined to comment, calling the speculation “market rumors,” while Puma has also refused to make a statement.

Danone (BN.FR) is gaining about 0.5% after Jefferies upgraded its rating from “Underperform” to “Buy.” Analysts praised the dynamic growth in its specialized nutrition segment in China and strong performance of high-protein products in North America. Despite challenges in the U.S. creamer segment, high-protein offerings have more than made up for the weakness.

SAP (SAP.DE) is down about 0.7% during today’s session. Despite strong financial results in previous quarters, investors remain cautious due to potential risks related to artificial intelligence integration and increasing competition in the software market. Nevertheless, SAP continues to maintain a strong market position, and the further development of its AI strategy could bring long-term benefits.