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DE30: Equity markets start firmer following US session

Summary:

  • European stock markets have opened higher after a successful session in the US
  • DAX (DE30 on xStation5) strives to break an important resistance
  • Thyssenkrupp (TKA.DE) capitalizes on wider job cuts so that it trims costs

Looking at the European stock markets one could notice that there are no uncertainties with regard to the NFP report. Better performance could be a result of the excellent session across the pond where the NASDAQ (US100) managed to close almost 1% higher while the Dow Jones (US30) and the SP500 (US500) picked up 0.25% and 0.57% respectively.

link do file download linkBuyers are striving to come back above an important resistance/support but more obstacles are in place though. Source: xStation5

Technically, the DE30 managed to rebound during the session on Thursday which could be a promising sign for buyers. However, before we see an extended rally (being potentially underpinned by the declining EURUSD), the price has to break and remain above a green rectangle. What’s more, even as the price is able to do so, it cannot lead to a knee-jerk move to the upside mainly on the back of two critical places.

Firstly, an ascending trend line (a purple line) could be a harder hurdle for buyers with another resistance placed around 12165 points being supported by a local resistance zone. Notice that the price has already tested this level several times, hence one could assume that it won’t be indifferent. To sum up, a sustained breakout above a descending trend line (a blue one on the chart above) would be needed to persuade more investors to enter longs.

link do file download linkThe German DE30 is beginning the session with upbeat spirits with just 5 stocks being traded below the breakeven line. Source: Bloomberg

Looking back to the Asian session, there were rather insignificant moves across the board. Taking a look at the Asian major indices, the NIKKEI (JAP225) turned out to be the best one and gained 0.23%. Elsewhere, the Shanghai Composite (CHNComp) added 0.19%, the Australian S&P/ASX 200 (AUS200) moved up all but 0.2% whereas the Hang Seng Composite (HKComp) edged down a bit more than 0.1%.

In turn, the European equity markets are bursting with enthusiasm being not specially worried about the NFP report. Whipping through specific indices one could spot that the French CAC40 (FRA40) has been the standout one so far gaining as much as 0.8%. Besides, the DE30 is moving up 0.6%, the EuroStoxx50 (EU50) is edging higher 0.7% whilst the British FTSE100 (UK100) is going up 0.3%.

Company news

Having looked into the breakdown of the German index one could perceive Thyssenkrupp (TKA.DE) which is gaining owing the report from the company. It said that the firm will cut as much as 2000 jobs in order to contain costs.

On top of that, Lufthansa (LHA.DE) is benefiting from a note of Goodbody’s analysts who have written that "while recent results from European airlines warned of a tougher yield outlook, gains in major stocks since the announcements reflect hope that an accelerated consolidation of the sector will improve capacity and pricing into next year".

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