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European indices, including the DAX 30, were hit this morning by the struggling oil price and banking sector performance as well as some disappointing news coming out of the likes of Lufthansa yesterday. However, an uptick in oil prices this morning after yesterday’s 4% tumble led to a late morning recovery which is currently holding with the DAX 0.2% up on yesterday’s close.
Siemens is leading gains on the DAX today, up 1.81% thanks to a UBS report on the engineering giant published today. The bank’s analysts are of the opinion that the company’s record backlog and its potential for good margins means that earnings over coming years are likely to be better than has been previously forecast. The company’s $113 billion backlog is thought to add up to around 1.3x estimated 2017 sales and have subsequently set a ‘buy’ rating and price target of 131 euros per share for the company. The company’s current share price, after today’s gains, is 118.5 euros.
Tyre-maker Continental has also seen its share price jump by 1.82% today after the company topped previously lowered full-year sales targets in 2016 due to an impressive Q4 performance. The company also forecast 6% sales growth for 2017 and a 10.5% margin on adjusted earnings before interest and taxes. Sales grew by 3% over 2016 to 40.5 billion euros. Fourth quarter figures were not released yesterday but did categorise them as ‘strong’ with net profit for the period slightly ahead of that achieved in 2015. The full figures are due to be published on March 2nd.
Thyssenkrupp is up 1.49% after the steel maker’s labour chief said the company would not pick up the bill for concessions proposed merger partner Tata Steel has given to workers at British steel plant Port Talbot. Semiconductor manufacturer Infineon Technologies is up 0.91% so far today, Volkswagen 0.72% and housing association Vonovia 1.35%.
The major fallers today are banks Deutsche Bank and Commerzbank, which have suffered respective 2.54% and 2.22% losses as the banking sector performs poorly globally today on fresh concerns over the Italian banking system. Lufthansa, which suffered a big loss yesterday on fears over 2017 growth prospects has stabilised today and is down a modest 0.21% with Deutsche Telekom, another of yesterday’s losers, again down with a loss of 1.01%.
