DE30 breaks above local market geometry

• European stock markets trade higher

• DE30 breaks above local market geometry

• European car sales drop for the 9th straight month

European stock market indices are trading higher on Wednesday, following a solid Wall Street session yesterday. Majority of blue chips indices from the Old Continent trade over 1% higher. Dutch AEX (NED25) is one of top performers, trading 1.5% higher. Polish WIG20 (W20) lags behind Western European peers but still manages to trade 0.8% higher on the day.

DE30 managed to break above the 14,200 pts resistance zone that was marked with the upper limit of a market geometry. In theory, this hints at reversal of short-term trend and signals possibility of a large upward move. A resistance at 14,300 pts is being tested at press time and should we see a break above this hurdle, the next target for buyers will be 14,600 pts area. Source: xStation5

European car sales dropped 19% YoY in March 2022, marking a 9th consecutive month of declines. Volkswagen Group (VOW1.DE) sales dropped 25% YoY, bringing YTD decline to 15.4%. BMW (BMW.DE) sales were 23% YoY lower in March with YTD decline being 11.1%. Mercedes-Benz Group (MBG.DE) sales were 18% YoY lower in March and 11% lower year-to-date.

Siemens Energy (ENR.DE) reported preliminary quarterly results today. Company reported an EBITA loss of €77 million (exp. €31 million profit), down from a €197 million profit a year ago. Order intake was 27.5% YoY lower at €10.52 billion while revenue dropped 1.7% YoY to €6.58 billion. Siemens Energy said that it will reassess guidance for the fiscal year (Q4 2021 - Q3 2022) to include the impact of underperformance at Gamesa Renewables, a subsidiary in which it holds 67% stake.

Continental (CON.DE) said that it has temporarily resumed production at its production plant in Kaluga, Russia. Company explained that it had to take such a decision as otherwise the company's workers and local managers could face criminal consequences for refusing to serve local demand. Continental initially suspended production at the plant on March 8, 2022.

Volkswagen (VOW1.DE) said that its new strategy assumes increasing resilience to global supply chain disruptions. Carmaker will aim to do this by increasing independence of regions and brands, for example by increasing use of regional suppliers. More details are expected to be announced in the coming weeks. In other news, Volkswagen reported that it managed to deliver 99.1 thousand battery EVs in Q1 2022, up 65% YoY.

Siemens Energy (ENR.DE) dropped at the start of the session today, after reporting weak preliminary results. However, stock managed to defend €18.20 support and recovered a bulk of losses later on. A big test for buyers, however, will be whether they managed to push the price above the downward trendline and snap a year-long trend. Source: xStation5