Dax slips significantly – pressure on Wirecard

The reason why the Dax suddenly slipped further in the afternoon: According to President Donald Trump, the US is considering that Chinese corporations have to follow American accounting ruleswhen traded on exchanges in the United States. After that, the US futures contracts also slipped, the S&P 500 should start trading with a minus of 1.7 percent.

Trump also said in a Fox Business Network interview on Thursday that he was “very disappointed” about China after the coronavirus pandemic broke out so soon after the recent trade deal was signed.

Tensions between governments in Washington and Beijing have recently increased again. Trump accused China of being responsible for the global spread of the virus. China is also apparently discussing a renegotiation of the trade agreement. Trump told Fox that there would be no renegotiations.

The fear of a flare-up of the trade dispute between the two largest economies recently also weighed on the US stock exchanges. No reassurance is in sight. Jochen Stanzl, chief market analyst at CMC Markets, pointed out on Thursday that the Chinese People’s Congress on May 22 could also result in “reactions to the US government’s policies”.

Despite the significant losses on Wednesday yesterday, the market is in good shape and continues to offer good prospects for higher prices. At least that’s what Joachim Goldberg thinks after evaluating the sentiment survey of the Frankfurt Stock Exchange yesterday Wednesday afternoon. Both institutional investors and private investors are surveyed.

In his view, investors are buying in after positive news, but are not responding to negative news with sales. According to the survey data, there is high demand in the range of 10,100 and 10,200 Dax points, which should initially prevent significant price losses.

Should the German leading index, however, surpass the 11,000 mark, investors would have to run after these price gains. Then the Dax could rise rapidly, possibly resulting in a so-called short squeeze.

The situation is similar in the United States: There is a high level of pessimism among investors, a classic contra-indicator for sentiment analysis because – to put it simply – pessimistic investors have already sold and are waiting for a rise. According to experts, this should prevent a significant slump in Wall Street.

The most interesting Dax share is currently Wirecard, which also presented quarterly figures today. According to preliminary figures, the payment service provider increased profit and sales by around a quarter. However, he feels the crisis in the business with flight groups.

The stock remains volatile: after a minus of three percent at the start, the paper turned positive and is currently again two percent lower at around 84 euros. In mid-April 2020, the price was still over 140 euros.

It is currently running apparently for a big showdown: Wirecard against ten hedge funds is the duel. As of Tuesday and Wednesday this week, the funds again increased their speculation on falling share prices.

At least 10.39 percent of the freely tradable Wirecard shares are now in the hands of ten short sellers, as can be seen from the current data from the “Bundesanzeiger” on Wednesday this week. The ratio is extremely high, equivalent to 12.83 million shares.

Short seller speculate on falling pricesby borrowing and selling shares in a company from mutual funds, for example. In order to return these shares after the deadline, you have to buy them again beforehand – if possible, of course, at a lower price.

This means that the short sellers will have to buy back a total of 12.83 million shares if everyone wants to close their bets. For comparison: The average daily volume since the beginning of the year is just under 2.4 million papers. However, this value has probably increased due to the involvement of the hedge funds and has amounted to 3.9 million units per day in the past four weeks.

Auto stocks were the bottom of the list in Europe. The Dax values ​​VW and Daimler lost around six percent, BMW titles dropped more than four percent. The European industry index fell 4.8 percent. Despite strong growth in China in April, BMW dampened hopes of a rapid recovery in the car markets in the rest of the world.

Look at the individual values

Deutsche Telekom: While all other companies are suffering from the corona crisis, the telecommunications giant from Bonn can increase sales and profits. All this gives the paper an increase of almost one percent in a weak market environment. The Telekom share does relatively well in corona times. Since the beginning of the year, paper has only fallen by around seven percent.

RWE: The energy company confirms the earnings forecast and the dividend target for 2020. RWE plans to invest billions in the expansion of green electricity. After a friendly start-up trade, the share fell 1.4 percent. The paper is currently unchanged from the price at the beginning of the year.

Teamviewer: The financial investor Permira has cashed in on the Corona crisis winner Teamviewer for the second time. Permira accommodated a share package from the Swabian software manufacturer within a few hours for 1.03 billion euros with large investors. This action does not ignore the current share price: With a minus of 9.3 percent on Thursday, paper is one of the biggest losers in the MDax.

Teamviewer is currently benefiting massively from the trend towards home office and the idle air traffic in the corona crisis, which is causing the demand for software for online conferences to skyrocket. Permira has reduced its stake in the company from Göppingen to 39 percent from 51.5 percent.

Ceconomy: The crisis-ridden electronics trade holding company writes deep red numbers in the corona crisis. The parent company of Media Markt and Saturn posted a loss of EUR 309 million in the second quarter of the 2019/20 financial year due to the regulatory closure of markets and high depreciation on the French subsidiary Fnac Darty. As a result, the share slips more than 14 percent.

Look at other asset classes

Today’s Wednesday is in demand Dollars and bonds, which are considered safe havens for investors. “The dollar is expanding its position as a protective currency,” said Ricardo Evangelista, an analyst at ActivTrades. The dollar index is picking up, gaining 0.2 percent to 100.41 points after US President Donald Trump made a positive statement about the strength of the US currency. Contrary to previous statements, Trump told Fox Business that it was “an excellent time to have a strong dollar.” Previously, Trump had been an eyesore. He had therefore pushed for rate cuts at the Federal Reserve. The euro falls 0.3 percent to $ 1,079.

There would also be comments from Powell, who at least initially ruled out negative interest rates. US securities also rose as a result, and the return fell to 0.614 percent in return. The gold price remained at around $ 1,715 per troy ounce.

The oil price rose, One barrel (159 liters) of light US oil was four percent higher at $ 26.29, while North Sea Brent oil rose by 3.7 percent to $ 30.27. Eugen Weinberg, commodity expert at Commerzbank, referred to signs that the oversupply is declining.

So they sank US inventory for the first time since mid-January, and the demand from the refineries in China is increasing strongly. The International Energy Agency expects global demand to plummet this year like never before. However, the estimate was 690,000 barrels better than before because the restrictions in the fight against the corona virus were gradually being removed.

What the chart technique says

According to the technical analysis of the chart, the Dax is about to set an important course. Does the support zone stop at around 10,300 points?

One thing is clear: there is a smorgasbord of important support, among other things the low of December 2018 with 10,279 points, the starting point for the rally until February 2020. And at 10,250 points there is a history low from which the Dax could rise again.

In addition, the 50-day line joins with 10,277 meters. This line is an indicator of the medium-term trend.

There are significant resistances on the top in the area of ​​around 11,000 points. For example, the 50 percent correction in the bear market since February has stood at 11,025 points. Because this mark corresponds to the middle of the downward movement from 13,795 to 8255 counters.

Here is the page with the Dax course, here are the current tops & flops in the Dax. Current short sales by investors can be found in our short sales database.

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