DE30: Lower PCE data lifts DE30 into ATH regions!

• DE30 in areas of historic highs

• Mixed GDP data from Germany

• Market sentiment is bolstered by lower core PCE reading from the US

This week's final trading session on the European market brings mixed investor sentiment. Despite declines in many companies, stock indices are gaining, with the German DAX climbing to historic highs. 

GDP data from Germany came out mixed. On the one hand, we have no change on a quarterly basis, with growth coming in at 0.0% k/k compared to an earlier revised reading of -0.1% k/k (previously -0.3% k/k). An increase of 0.1% k/k was, however, expected, although we are generally positive about the revision. 

On an annualised basis, the decline is -0.2% y/y against a previous decline of -0.2% y/y (here revised from -0.5% y/y). A decline of -0.3% y/y was expected. Nevertheless, we have the German economy entering a technical recession and the PMI data for July, already for Q3, show a further deterioration. 

The bullish sentiment was reinforced by macro data from the US, which pointed to a possible decline in inflationary pressures in that country. 

The mood in Europe during this week's last trading session is clearly negative, nevertheless some sectors managed to maintain sizable rallies. Source: xStation 5

German DE30 futures gained nearly 0.82% during today's session and climbed to historic highs. Source: xStation 5

News:

The shares of EON (EOAN.DE) failed to maintain their initial gains after the publication of quarterly results and the raising of annual forecasts, which according to analysts evaluating the company's report may be short-lived. 

Overall, however, the company's results surprised positively, which the company itself explains by an increase in profit and an improved outlook in the wider sector following last year's energy crisis in the wake of the war in Ukraine.

Adjusted net profit was €2.3 billion in the first six months of the year, up from €1.4 billion a year earlier.

E.ON said it now expects adjusted net profit for the full year to be between €2.7 billion and €2.9 billion.

This is up from previous expectations of between €2.3bn and €2.5bn.

EON share chart (EOAN.DE). Source: xStation 5

The shares of BASF (BAS.DE) are up sharply today, despite worse-than-expected EBIT results. The company announced that it is cutting its investment budget in the face of the economic slowdown and intends to maintain strict discipline when it comes to investments.  Investments this year will be cut to €5.7 billion, compared to the €6.3 billion forecast earlier this year. 

BASF reported a 25 per cent drop in quarterly sales (y/y) due to difficult market conditions and low demand from key customers. The company's sales in the second quarter amounted to €17.3 billion , while EBIT before extraordinary items fell by €1.3 billion to €1 billion.

Source: xStation 5

Major percentage changes in individual companies of the DAX index. Source: Bloomberg

Information from individual companies in the DAX index. Source: Bloomberg