Deutsche Bank share price sends mixed signals ahead of Q3 earnings
The Deutsche Bank share price remains in a tight range as investors wait for its third-quarter financial results. DBK, the biggest bank in Germany, was trading at €29, down from the year-to-date high of €32.17. It is up by ~90% from its lowest point this year.
Deutsche Bank earnings ahead
Deutsche Bank will publish its financial results this week. Based on the numbers by top companies like JPMorgan, Barclays, and Unicredit, chances are that its business will record strong financial results.
The most recent numbers showed that its revenue rose by 6% in the first half of the year to €16.3 billion. This growth means that the company is on track to hit its €32 billion revenue goal.
Deutsche Bank’s management, under Christian Sewing, has also worked to reduce its costs. Its non-interest expenses dropped to €10.6 billion, down from the previous €12 billion.
All four businesses did well in the year’s first half. The Corporate Bank’s profit before tax rose to €1.4 billion, while the investment bank, private bank, and asset management rose by 18%, 50%, and 52%, respectively.
The upcoming results will likely show that the company continued doing well in the third quarter. One major aspect is that banks with investment banking business are thriving as the sector bounces back.
Data shows that deals worth over €1 trillion were announced in the last quarter. This benefited advisors like Deutsche Bank.
At the same time, the volatility in the financial market has boosted its fixed income and currencies (FIC) business. Its FIC revenue jumped by 11% in the last quarter to €2.3 billion partly because of Donald Trump’s tariffs that led to substantial volatility in the market.
READ MORE: Here’s why the Deutsche Bank share price is surging
The company is also benefiting from an improvement in provisions for bad credit. These provisions stood at €423 million in the second quarter, down by 10% from the same period last year. The same happened in the first half of the year.
Deutsche Bank’s management has also worked to improve its balance sheet, allowing it to return more money to shareholders. Its Common Equity Tier 1 Capital Ratio rose to 14.2% from the previous €13.8%.
Deutsche Bank share price analysis is sending mixed signals
The daily timeframe chart shows that the DBK stock price has been under pressure in the past few months. It formed a double-top pattern at €32, its highest point in August and September this year.
The stock is now hovering at the neckline of this pattern at €29.20, its lowest point in September. It has moved below the 50-day Exponential Moving Average (EMA), confirming the bearish outlook.
On the positive side, Deutsche Bank’s stock price has formed a bearish reversal pattern. This pattern happens when an asset forms a down-gap and then consolidates for a while. It often leads to a rebound, which may happen after its earnings this week.
On the flip side, a move below the lower side of the island at €28.20 will confirm a bearish breakout.
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