DE30 remains in the vicinity of early-July peak

• Mixed session on the Old Continent on Friday, Brexit in the spotlight

• DE30 sends warning signals near early-July peak

• AMS discussed submitting renewed offer for Osram (OSR.DE)

Moods on the Old Continent can be named as mixed on the final trading session of the week. Indices from the UK, France and the Netherlands are trading lower while small gains can be spotted on the German, Spanish and Portuguese stock exchanges. Trading in Europe is focused on Brexit so traders should keep track of incoming newsflow as hints that the Brexit deal will pass votes in the UK Parliament tomorrow could trigger euphoria.

Source: xStation5

The German DAX (DE30) managed to paint fresh YTD high yesterday thanks to optimism triggered by announcement of Brexit deal. However, as concerns began to mount whether the UK parliament will pass it or not, the German index trimmed all of its gains. In turn, a doji candlestick with long upper shadow surfaced on the D1 interval. From a technical point of view, such a pattern hints at bears looming above the level of early-July peak (12645 pts) and it could discourage some buyers. In case a downward move is launched, the first support to watch is the zone ranging above the 12450 pts. One should keep in mind that indices are likely to be vulnerable to any Brexit related headlines. In case we do not get such today, one should expect increased volatility on Monday’s opening as we will know the outcome of votes in the UK parliament.

DAX members at 9:36 am BST. Source: Bloomberg

Deutsche Post (DPW.DE) can be found among DAX leaders on the final trading session of the week. Upbeat sentiment towards the stock was spurred by an upgrade at Berenberg. The bank raised recommendation for Deutsche Post shares to “buy” from “hold”. Price target was set at €38. Analysts reasoned their decision saying that prospects for the German logistics companies are improving and expressed confidence in the company reaching its 2020 earnings targets.

Shares of Vonovia (VNA.DE) may enjoy elevated volatility today as German authorities resume talks over potential rent freeze in Berlin. Lack of consensus caused the decision to be adjourned last night.

According to Bloomberg report, two private equity firms - Cinven and Bain Capital - are preparing a joint bid for BASF (BAS.DE) chemical business unit. Private equity firms are growing more and more interested in a buyout of BASF’s unit after LafargeHolcim, the global cement maker, withdrew its offer. Lone Star is another PE firm interested in BASF’s unit so there is a chance for a bidding war to start.

Bloomberg reports that AMS, the Austrian chip and sensor maker, is planning to discuss renewed bid for the German lightning manufacturer, Osram (OSR.DE). Let us recall that previous offer of AMS worth €4 billion failed to secure approval. Supervisory board of the Austrian firm will meet today to discuss potential options.

Following a failed attempt of breaking above the resistance zone ranging above the €40.50, shares of Osram (OSR.DE) pulled back and found support at the €38 handle. An upward move was launched from there and it has accelerated over the past two days. One should keep in mind that previous takeover offer of AMS was €41/share therefore any new one should be at least equal. Having said that, in case the AMS submits new offer, an attack on the aforementioned resistance zone may be on the cards. Source: xStation5