Oct. 10 (Bloomberg) -- German stocks rose for a fourth day, for the benchmark DAX Index’s biggest four-day rally since 2008, as Chancellor Angela Merkel and French President Nicolas Sarkozy set a deadline for a plan to recapitalize banks in Europe.
Adidas AG advanced 3.7 percent as the world’s second- largest sporting-goods maker forecast sales growth in Russia. Metro AG slid 3.2 percent after announcing Chief Executive Officer Eckhard Cordes doesn’t intend to extend his contract.
The benchmark DAX Index gained 3 percent to 5,847.29 at the 5:30 p.m. close in Frankfurt. The DAX has risen 12 percent over the last four days. The gauge advanced last week as investors speculated that policy makers will act to support the region’s debt crisis and U.S. jobs data spurred optimism that the world’s largest economy will avoid a recession. The broader HDAX Index also added 3 percent today.
“Optimism has driven the markets after signs of convergence” following the German and French leaders’ meeting yesterday, said Anita Paluch, senior sales trader at Gekko Global Markets Ltd. in London. At the same time, “the details are scarce, if any, and it has yet to be decided who will have to pay for banks’ capitalization requirements.”
Facing growing concern Greece is headed toward a default, Merkel said yesterday at a joint press conference with Sarkozy in Berlin that European leaders will do “everything necessary” to ensure that banks have enough capital. Sarkozy said they would deliver a plan by the Nov. 3 Group of 20 summit.
Adidas, Henkel Rise
Adidas climbed 3.7 percent to 49.27 euros after Chief Executive Officer Herbert Hainer said in a statement that revenue in Russia and the Commonwealth of Independent States, excluding currency effects, will exceed 1 billion euros ($1.37 billion) by 2013.
Henkel AG’s preferred shares increased 2.2 percent to 42.15 euros. The company may make acquisitions and could finance the deals from its own coffers, Sueddeutsche Zeitung reported, citing Chief Executive Officer Kasper Rorsted. The glue and detergent maker expects to meet its profitability forecasts, Rorsted was cited as saying. The CEO doesn’t expect a repeat of the 2008 economic crisis, the newspaper said.
Metro, Germany’s largest retailer, dropped 3.2 percent to 32.18 euros after Cordes said he doesn’t intend to extend his contract beyond next year following media speculation that he had lost the backing of some supervisory board members.
In a statement released on Metro’s website yesterday, Cordes said that the “trustful basis to stay on as head of Metro’s top management does not anymore exist” after “incidents of the recent weeks and months.”
The stock was downgraded to “neutral” from “buy” at Goldman Sachs Group Inc.
--With assistance from Corinne Gretler. Editors: Tom Lavell, Will Hadfield
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