DE30 climbs back above 12,600 pts after plunge

• European try to recover from morning plunge

• DE30 tested monthly lows in 12,550 pts area

• Daimler says it may lose hundreds millions of euros without Brexit deal

Stock market indices are experiencing heavy selling during today's European session. Indices from Western Europe trade 0.6-1.2% lower with UK and Belgian equities being top laggards. S&P 500 futures trade around 0.2% below yesterday's closing prices. Lockdowns and lack of Brexit trade deal remain the biggest risk factors for stocks from the Old Continent

Source: xStation5

DE30 plunged below the neckline of head and shoulders pattern today. Potential range of the pattern points to 12,475 pts but so far declines were halted near monthly lows at 12,550 pts. German index painted a lower low in the current downward sequence creating a bearish bias in the market. Rapid coronavirus spreading as well as lack of breathought in neither US stimulus, nor Brexit talks is fuelling sell-off and related news should be watched closely. In case we see a break below 12,550 pts, attention will shift to support at 12,350 pts. On the other hand, should indices recovery, the first major resistance is located in 12,900 pts area.

DAX members at 10:30 am BST. Source: Bloomberg

Company News

Airbus (AIR.DE) won a contract with the EU Coast Guard for drones that will be used for surveillance services in the Mediterrean Sea. Deal is for a four year period and financial details were not disclosed so far. However, the media reports that it is worth tens of millions of euros.

Daimler (DAI.DE) said that it may lose hundreds of millions of euros if the United Kingdom leaves European Union without a trade deal. This is because tariffs on WTO rules would hurt competitiveness of German-produced cars in the United Kingdom. Moreover, Daimler CEO said that the UK market generates too small sales volumes to build a manufacturing plant there.

Bilfinger (GBF.DE) is defying the broad market trend and trades higher today. German industrial construction and engineering company is rumoured to have attracted interest from private equity firms, including US Clayton Dubilier & Rice. Stock is down 45% year-to-date and there is speculation that buyout firms may try to take the company private.

Airbus (AIR.DE) is dropping along with the broad market today. Share price of European planemaker is pulled back from the resistance zone at €67.50 and reached support at €65. Bulls are trying to halt declines there but if they fail, a test of 200-hour moving average (purple line, €64 area) cannot be ruled out. Source: xStation5