DE30: Infineon jumps on attempt to block merger with Cypress

Summary:
- Fresenius Medical Care (FME.DE) tries to recoup some of yesterday’s losses
- DAX (DE30) plunges below the breakout level
- Cypress (CY.US) shareholders sue company over merger with Infineon (IFX.DE)

European stock market indices are performing poorly at the beginning of Wednesday's session and majority of the blue chips benchmarks are trading below yesterday’s closing prices. However, in most cases scale of decline is minor. Italian stock market index FTSE MIB (ITA40) stands out among the European benchmarks as it gains more than 0.7% after the first hour and a half of trading.

DE30 broke back below the breakout level at 12450 pts handle. Downward momentum looks strong therefore one cannot rule out a deepening of the decline to as low as 12150 pts handle, where the upper limit of the nearest demand zone can be found. The 50-session moving average can also be found in the area boosting the significance of the aforementioned zone. Source: xStation5

White House announced that the US President will sign an executive order on “advancing kidney health” today. According to the yet unconfirmed reports, Trump will encourage Medicare to adjust payments for kidney treatment and encourage patients to undergo dialysis at home. Such a move is especially unfavourable for Fresenius Medical Care (FME.DE), the german company that operates a vast network of dialysis clinics in the United States. Fresenius share plunged yesterday and today we can see an attempt to regain losses.

Airbus (AIR.DE) reported that cracks have been found on the wings of some of its A380 double-decker jets. In turn, the European planemaker said that it will inspect machines that are currently in use. 25 planes used by airlines from Singapore, Australia and the United Arab Emirates will be examined in the first place. However, the jets will not need to be grounded as the inspections can be done during the regular, scheduled overhauls. As the inspections will not delay flights, any financial consequences for Airbus are unlikely. 

DAX member at 9:19 am BST. Source: Bloomberg

According to the Handelsblatt report, the Deutsche Bank executives who will lose their jobs due to the bank’s overhaul are set to get a big severance. Newspaper claims that three of the management board members that are set to depart from the German lender will get a combined severance €26 million. Around €11.2 million will go to Garth Ritchie, head of the investment banking unit. Other executives that are set to depart are Sylvie Matherat, Chief Regulatory Officer, and Frank Strauss, chief of the retail banking unit.

The Financial Times reported that BMW (BMW.DE), the German car maker, is set to shift the engine production for the UK factory to Germany. The move is aimed at ensuring engines being in sync with trade rules before the United Kingdom parts ways with the European Union.

Shareholders of Cypress Semiconductors (CY.US) are suing the company over the merger with the German Infineon Technologies (IFX.DE). Investors claim that the US chipmaker did not provide them with enough information concerning the sale and may have put them at a disadvantage by doing so. Shareholders of Infineon seem to like the attempt to block the merger as company’s shares trade among DAX leaders today.