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European markets gain for the second day to erase Monday’s sell-off
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DE30 testing the 12,800 pts area
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European sportswear surge as main U.S. rival reports brilliant results
European markets opened higher on Wednesday. From the beginning of the session, investors were waiting for key PMI releases for the month of September. PMIs turned out to be rather mixed as manufacturing bounced while services slipped into contraction. The latter might not come as a surprise due to renewed virus restrictions. As virus concerns have been mounting in Europe these days, services may still be under enormous pressure. Nevertheless markets seem to accelerate gains with DAX rising as much as 1.80%. Other blue-chip indices from Europe advance roughly 2% as well.
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Open account Try demo Download mobile app Download mobile appDE30 has been trying to recover recent slump for the second day in a row. The index broke above the 50-hour moving average (purple line) at the beginning of today’s cash session (note that DE30 also managed to broke above the 38.2% Fibo retracement). The index is currently testing the 12,800 area. Should market sentiment reverse, the mentioned 50-hour moving average may be viewed as a near-term support level.
DAX members at 10:06 am BST. Source: Bloomberg
Adidas (ADS.DE) and Puma SE (PUM.DE) - European sportswear stocks - surge after U.S. peer Nike reported sales and profits well above projections. Nike’s EPS for its fiscal Q1 was more than double analysts estimates. Adidas is adding as much as 6% today.
Adidas (ADS.DE) has been gradually marching North since the February-March slump. As stock opened with a huge bullish gap today, shares broke above the 78.6% Fibo retracement of the coronavirus market crash. Bulls might expect some resistance in the €294.50 area. Source: xStation5
Deutsche Boerse announced that Siemens Energy will be included in the DAX for one day on September 28 due to the spin-off from Siemens AG (SIE.DE). Therefore, the DAX index will be calculated on a basis of 31 companies for this one day. At the close of trading on Sept 28 Siemens Energy will be removed from the index.
Continental AG (CON.DE) and Osram Licht AG (OSR.DE) are in talks to scrap automotive joint venture by the end of the year. The reason is coronavirus pandemic which resulted in lower car demand - Continental does not expect recovery of car production to 2017 levels until 2025. Joint venture has roughly 1500 employees at 14 locations.
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