Bloomberg News

German Stocks Decline After Fed Minutes; Allianz Falls

February 21, 2013

German stocks declined the most in two weeks on concern the U.S. Federal Reserve will scale back its asset-purchase program in the world’s largest economy.

Deutsche Bank AG and Commerzbank AG, the country’s biggest lenders, dropped at least 2.9 percent. Allianz SE (ALV) retreated even after saying profit more than doubled in the fourth quarter.

The DAX Index (DAX) slipped 1.6 percent to 7,609.33 at 10:21 a.m. in Frankfurt. The benchmark gauge is little changed so far this year, among the worst performers of 24 developed-market indexes tracked by Bloomberg. The broader HDAX Index also fell 1.5 percent today.

Fed officials continued to debate whether monetary easing risks unleashing inflation or fueling asset-price bubbles.

Several participants at the Federal Open Market Committee’s Jan. 29-30 meeting “emphasized that the committee should be prepared to vary the pace of asset purchases, either in response to changes in the economic outlook or as its evaluation of the efficacy and costs of such purchases evolved,” according to minutes released after the close of European markets yesterday.

The volume of shares changing hands in DAX-listed companies was 82 percent higher than the average of the past 30 days, according to data compiled by Bloomberg.

German services output expanded less than forecast this month, according to a report from London-based Markit Economics. An index based on a survey of purchasing managers in the industry retreated to 54.1 from 55.7 in January, compared with the median forecast for a 55.5 level in a Bloomberg survey. The measure for factory output rose to 50.1 in February from 49.8 last month. A reading above 50 signals expansion.

European PMI

Euro-area services and manufacturing contracted at a faster pace than economists forecast in February, according to a separate survey from Markit.

A composite index of both industries in the 17-nation currency bloc fell to 47.3 from 48.6 in January. Economists had forecast a reading of 49, according to the median of 22 estimates in a Bloomberg News survey.

Deutsche Bank and Commerzbank fell 3.4 percent to 34.97 euros and 2.9 percent to 1.43 euros, respectively.

Allianz, Europe’s biggest insurer, lost 1.2 percent to 103.10 euros. Net income rose to 1.22 billion euros ($1.61 billion) in the fourth quarter of 2012 from 492 million euros the previous year, the Munich-based company said. That beat the 1.15 billion-euro median estimate in a Bloomberg survey.

Bilfinger SE retreated 2.3 percent to 79.56 euros, its biggest drop in more than two weeks. UBS AG cut its recommendation on the German builder to neutral from buy, with analyst Gregor Kuglitsch saying the company’s transformation into services from a construction-dominated business is already reflected in the share price.

To contact the reporter on this story: Sofia Horta e Costa in London at

To contact the editor responsible for this story: Andrew Rummer at

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