- German index continues slight decline
- The conflict in the Middle East continues to weigh on European companies
- Zalando hits a new year-low
European stock indices remain under pressure from incoming news from the Middle East. Investors maintain a subdued sentiment, which translates into minor movements on European indices. The specter of escalating conflict and the risk of the United States joining the war mean that risk-on strategies are mostly limited for now. On the other hand, the market still isn’t pricing in a full-scale conflict, and the behavior of the Israeli stock exchange, which is setting new highs, suggests a belief in a quick resolution.
Therefore, even despite small declines on Old Continent exchanges, a further escalation of the conflict between Iran and Israel could lead to more significant corrections on European indices.
Today’s session is quiet, and the absence of stock market trading in the USA due to Juneteenth will also likely contribute to reduced market volatility.
DAX (DE40) futures continue in a downtrend. This channel may persist given the ongoing market uncertainty. In such a scenario, any rebound could reach 23350 points, where resistance is located at the upper boundary of the downtrend channel. In case of downward pressure, investors should watch the 23080 points level, which forms the support of the lower boundary of the corridor. Source: xStation
Company News
- Zalando (ZAL.DE) is down over 4% today, reaching a new year-to-date low. The company is currently trading at its lowest level since early November 2024. The company has been under negative pressure since the beginning of June due to growing concerns about the strength of the German consumer and a series of forecast downgrades for the entire sector.
- Airbus (AIR.DE) is down slightly below 0.8% today. The company announced new orders, which increased its order portfolio obtained during the ongoing Paris Air Show to 21 billion euros. Boeing decided not to report sales progress after the Air India crash.
- Pernod Ricard (RI.FR) announced a change in its company structure. According to Reuters reports, the company is to be divided into two segments: Gold (including champagnes, Martell cognacs, and Jameson Irish whiskey) and Crystal (which will include Havana Club, Absolut vodka, and French aperitif brands). The decision aims to optimize the company’s operations in the face of weakening demand from the US and Chinese markets. Organizational changes also plan for job reductions and cost cuts of up to 1 billion euros by 2029.
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