Bloomberg News

Most German Stocks Advance as BASF, Linde Outweigh Italy

December 10, 2012

Most German stocks advanced as gains by BASF AG and Linde AG outweighed investor concern over Italian Prime Minister Mario Monti’splan to resign and a delay in the completion of Greece’s bond buyback.

BASF contributed the most to the DAX (DAX) Index’s gain, rising 0.9 percent. Linde added 0.8 percent. Curanum AG (BHS) jumped to its highest price in almost 10 months after French rival Korian made a bid for the company. Deutsche Bank AG (DBK) and Commerzbank AG (CBK), Germany’s biggest lenders, dropped more than 1 percent.

The DAX advanced 0.2 percent to 7,530.92 at the close in Frankfurt, with three shares rising for every two that fell. The gauge has rallied 26 percent from its low on June 5 as European Central Bank policy makers agreed on an unlimited bond-purchase program and the Federal Reserve announced a third round of quantitative easing. The broader HDAX Index rose 0.1 percent.

“The basic trend is still a year-end rally,” Robert Halver, head of capital markets research at Baader Bank AG in Frankfurt, said in a telephone interview. “There is a necessity for asset managers who were not investing in equities in the summer to be in the market. Still, the markets are handicapped by Italy. There is a big risk that Berlusconi could come back. We need a clear picture and reform agenda.”

Monti said he will resign after parliament approves the country’s budget for 2013, while his predecessor, Silvo Berlusconi intends to seek a return to power. Berlusconi’s People of Liberty will support the government in the budget vote, according to the party’s general secretary.

Greek Buyback

Greece extended a deadline to spend 10 billion euros ($12.9 billion) buying back sovereign debt until midday tomorrow, according to the country’s Public Debt Management Agency. The indebted nation was close to reaching its target in a program aimed at winning aid from the International Monetary Fund and the European Union, an official at the Greek Finance Ministry said yesterday on condition of anonymity.

BASF, the world’s biggest chemical maker, climbed 0.9 percent to 70.61 euros, its highest price in more than 20 years. A gauge of chemical stocks was among the biggest gainers on the Stoxx Europe 600 Index today.

Linde rose 0.8 percent to 134.70 euros. The industrial gases company signed an agreement to buy helium from OAO Gazprom.

Curanum surged 14 percent to 2.49 euros, its highest price since Feb. 22, after Korian offered to buy the German nursing- home operator for about 106.3 million euros, or 2.50 euros a share.

Banks Drop

Deutsche Bank slid 1.1 percent to 34.16 euros and Commerzbank retreated 1.6 percent to 1.38 euros. A gauge of banks fell the most on the Stoxx 600.

Deutsche Bank Chairman Paul Achleitner will investigate former employees’ allegations of false accounting, Der Spiegel reported on Dec. 9 without saying where it got the information.

German electricity for delivery in 2013 fell to a record low as EU emissions permits showed losses, according to broker data compiled by Bloomberg.

RWE AG (RWE), Germany’s second-largest utility, slipped 1 percent to 31.21 euros. Bank of America Corp’s Merrill Lynch unit lowered its recommendation on the shares to underperform, the equivalent of a sell rating, from neutral.

EON SE, the country’s biggest utility, dropped 0.4 percent to 13.84 euros, paring earlier losses of as much as 1.6 percent.

To contact the reporter on this story: Namitha Jagadeesh in London at njagadeesh@bloomberg.net

To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net


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