April 14 (Bloomberg) -- German stocks including BASF AG and Bayer AG dropped, while shares of Deutsche Telekom AG advanced.

The benchmark DAX Index dropped 3.64, or 0.1 percent, to 4402.05, its third drop in four sessions. DAX June futures rose 0.1 percent, to 4417. The HDAX Index of the country's 110 biggest companies dropped 0.1 percent to 2258.09.

BASF, the world's biggest chemicals maker, dropped for the second straight day, falling 1.02 euros, or 1.9 percent, to 53.50 euros. Owen Dwyer, an analyst at Merrill Lynch & Co., yesterday lowered the recommendation on BASF shares to ``neutral'' from ``buy,'' citing the possibility of a demand slowdown in China and the U.S. for chemicals in the second half.

Bayer, Germany's second-biggest drug and chemicals maker, rose 43 cents, or 1.6 percent, to 26 euros.

Deutsche Telekom, Europe's largest phone company, added 15 cents, or 1 percent, to 15.65 euros. Deutsche Boerse AG, Europe's biggest stock exchange by market value, rose 1.10 euros, or 1.8 percent, to 62.30 euros, the best performing stock on the DAX.

The following stocks made gains or losses. Stock symbols are in parentheses after the company names.

AAP Implantate AG (AAQ GY) rose 2 cents, or 1 percent, to 1.91 euros. The maker of artificial bone and joint implants said its full-year loss narrowed after costs related to acquisitions weren't repeated.

Bilfinger Berger AG (GBF GY), Germany's second-largest builder, fell 41 cents, or 1 percent, to 39.70 euros. The company expects Allianz AG, Europe's largest insurer, to sell its 25 percent holding sooner or later, Reuters said, citing CEO Herbert Bodner.

Allianz spokeswoman Antje Terrahe declined to comment and Bilfinger spokesman Sascha Bamberger wasn't immediately available for comment.

Epcos AG (EPC GY) shares of the maker of electronic components fell 64 cents, or 6.3 percent, to 9.48 euros, after the maker of electronics components said it had a fiscal second- quarter loss because of lower prices and one-time costs. The company also said it can't rule out a full-year loss. The shares are down 50 percent in 12 months, making them the second-worst performer on Germany's DAX 100 Price Index of 110 members in the period.

Deutsche Lufthansa AG (LHA GY), Europe's second-largest airline, slid 14 cents, or 1.3 percent, to 11.06 euros. The shares were cut to ``hold'' from ``add'' at ABN Amro Holding NV, which cited concern that revenue at European network carriers may be hurt by record-high fuel prices and slowing economic growth.

Douglas Holding AG (DOU GY), Europe's largest cosmetics retailer, fell 50 cents, or 1.7 percent, to 28.70. HDE industry group said German retail sales will drop in 2005 for a fourth year as consumers uneasy about record joblessness continue to rein in spending. Industry sales will fall between 0.5 percent and 0.8 percent this year, HDE reported.

KarstadtQuelle AG (KAR GY), the German department store operator that's shedding assets, lost 8 cents, or 1 percent, to 7.92 euros.

Hornbach Baumarkt AG (HORN GY), Germany's fourth-largest home-improvement retailer, dropped 1.70 euros, or 4.8 percent, to 34 euros. Profit in fiscal 2006 will only be ``slightly'' higher than the previous year as the company expands abroad and cuts prices, parent company Hornbach Holding AG reported.

IM Internationalmedia AG (IEM GY) rose 4 cents, or 7.3 percent, to 59 euro cents, after the German film company announced that Moritz Bormann will step down as chairman of the company's management board at the end of the month. Martin Schuermann, a former managing director at Bertelsmann AG's film unit, will replace Bormann.

ThyssenKrupp AG (TKA GY), Germany's largest steelmaker, fell 21 cents, or 1.3 percent, to 15.76 euros. Steel prices in China, the world's biggest user, may fall as much as 15 percent by the end of June, UBS AG said. Lance He, a Shanghai-based analyst, noted falling construction demand and increasing imports that are swelling available supplies.

Salzgitter AG (SZG GY), Germany's second-largest steelmaker, fell 9 cents, or 0.5 percent, to 16.66 euros.

To contact the reporter on this story: Chris Fournier in Frankfurt at Cfournier3@bloomberg.net

Last Updated: April 14, 2005 12:06 EDT