DAX index retreats as Wirecard plot thickens: Deutsche Bank shares lead

The DAX index declined by more than 0.90% as investors looked forward to a statement by Christine Lagarde. The index was the worst-performing in Europe followed by the CAC 40, which eased by 0.75% and the FTSE 100 index, which declined by about 40 basis points. Wirecard, the payment giant, was the biggest loser in the index.

Wirecard share price drops

Wirecard, the embattled payment company, was the worst-performing stock in the DAX index. That is after the police raided the company on Friday after Munich prosecutors launched a criminal investigation against Michael Braun. The prosecutors were following recommendations from BaFin, the financial regulator.

BaFin has been investigating the company about misleading statements made by the company to its shareholders. This is after KPMG concluded a long investigation that emerged from reporting by the Financial Times. In its investigation, the accountant firm said that it was unable to verify the genuineness of the sales and profits from third parties.

According to the Financial Times, the current investigation relates to two statements the firm made on March 12 and April 22. These statements are said to have been misleading to investors.

Wirecard is the most successful German fintech company that has a market cap of more than $10 billion. It is known for replacing Commerzbank in the DAX index.

The Wirecard share price is trading at 93 euros.

Best and worst performers in the DAX index

Most companies in the DAX index were in the red today. The only ones that were in the green were Deutsche Bank, Volkswagen, BMW, Daimler, Continental, Lufthansa, and RWE. Deutsche Bank share price rose by more than 2%. At the same time, Lufthansa shares rose after the company is about to be removed from the DAX index following the cash injection by the government.

On the other hand, the worst performers were Fresenius, Infineon, Adidas, Deutsche Borse, and Henkel, which dropped by more than 2%.

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DAX Index technical outlook

The DAX index is trading at €12,745, which is lower than the previous high of €12,850. On the daily chart, the price is still above the 50-day and 100-day exponential moving averages. It is also slightly above the 78.6% Fibonacci retracement level while the RSI had moved to the highest level since November last year. The index may continue to rise as bulls attempt to move to the important resistance level of €13,000.

On the flip side, a move below €12,000 will signal that there are more sellers in the market. This price is an important psychological level that is between the 61.8% and 78.2% retracement level.

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