Oct. 16 (Bloomberg) -- German stocks declined after Bank of America Corp. reported a third-quarter loss, sales from General Electric Co. missed analysts’ estimates and confidence among U.S. consumers fell more than forecast.

Deutsche Bank AG and Commerzbank AG dropped more than 2 percent. Siemens AG, Europe’s largest engineering company, also retreated. Salzgitter AG and ThyssenKrupp AG, Germany’s biggest steelmakers, slid with metal prices.

The benchmark DAX Index fell 1.5 percent to 5,743.39, trimming its weekly gain to 0.6 percent. The measure has still rallied 57 percent since March 6 as companies reported better- than-estimated earnings and economic data signaled the global recession is nearing an end. The broader HDAX Index decreased 1.5 percent today.

“We can be optimistic but we shouldn’t be unreasonable,” said Emmanuel Soupre, who helps manage about $20 billion at Neuflize OBC. “Earnings and economic data are bringing the market back to reality. We have been tackling the global economic crisis but this crisis is not over yet.”

The Reuters/University of Michigan preliminary index of consumer sentiment decreased to 69.4 from 73.5 in September, which was the highest level in more than a year. Measures of expectations for six months ahead and current conditions both fell. The index averaged 87.3 in 12 months leading to December 2007, when the recession began.

Deutsche Bank, Germany’s biggest bank, lost 2.8 percent to 54.83 euros, while smaller rival Commerzbank declined 3 percent to 8.38 euros.

Bank of America, GE

Bank of America, the largest U.S. lender, had a third- quarter loss of $1 billion, or 26 cents per diluted share, compared with a profit of $1.18 billion, or 15 cents, in the year-earlier period.

Siemens tumbled 2.8 percent to 66.56 euros. GE, the world’s biggest maker of jet engines and medical imaging machines, posted third-quarter revenue of $37.80 billion, while analysts surveyed by Bloomberg had estimated $39.66 billion.

Salzgitter and ThyssenKrupp retreated 1.6 percent to 70 euros and 2.3 percent to 25.12 euros, respectively. Copper and nickel declined on the London Metal Exchange, weighing on basic- resource shares across Europe.

Funkwerk AG sank 18 percent to 6.31 euros, the biggest loss since July 2006. The German maker of phone systems for cars and railways cut its forecast for 2009 due to an unexpected sharp drop in its export business. The company sees sales dropping to about 230 million euros ($342 million) and a loss before interest and taxes of up to 19 million euros.

IVG Immobilien AG rallied 5.8 percent to 8.06 euros as the company said it sold a number of properties in recent weeks valued at a total of 470 million euros.

To contact the reporters on this story: Julie Cruz in Frankfurt at jcruz6@bloomberg.net; Daniela Silberstein in Zurich at dsilberstei2@bloomberg.net.

Last Updated: October 16, 2009 11:48 EDT