DAX Benchmark Retreats; Shares of Deutsche Telekom, Salzgitter, QSC Fall

German stocks retreated, after the benchmark DAX Index posted a gain last week, amid lingering concern that Europe’s debt crisis will spread.

Deutsche Telekom AG and ProSiebenSat.1 Media AG fell as analysts cut their recommendations on the stocks. Salzgitter AG slid with metal prices, while Deutsche Bank AG and Commerzbank AG followed European banking shares lower. Singulus Technologies AG surged after gaining an order.

The DAX slid 1.3 percent to 6,857.06 at the 5:30 p.m. close in Frankfurt, erasing last week’s gain of 0.5 percent. The measure surged 16 percent last year as corporate profits rose, the Federal Reserve implemented actions aimed at boosting the economic recovery in the U.S. and the European Union bailed out Greece and Ireland. The broader HDAX Index lost 1.4 percent today.

“Speculation that Portugal may be tapping the EU rescue fund certainly doesn’t help the market today,” said Christian Falkner, an analyst at Alpha Wertpapierhandels GmbH in Frankfurt. “On the companies’ side however, we have positive news. Symrise is supported by M&A activity.”

Portugal, Spain and Italy are scheduled to sell debt this week following a slump in euro-area government bonds last week, triggered by concern over the European Union’s ability to stem the crisis.

EU leaders may discuss expanding the 750 billion-euro ($967 billion) rescue fund for indebted nations at their next summit in February, Handelsblatt newspaper reported, citing German government officials it didn’t identify. Der Spiegel magazine said the EU could time such a pledge to coincide with granting aid to Portugal.

Deutsche Telekom

Deutsche Telekom slipped 1.8 percent to 9.68 euros as Europe’s largest telephone company was cut to “underperform” from “neutral” at Credit Suisse Group AG.

ProSiebenSat.1 declined 4.6 percent to 22.78 euros, the first retreat in three trading sessions. Germany’s biggest private broadcaster was cut to “equal-weight” at Morgan Stanley.

Salzgitter, Germany’s second-biggest steelmaker, lost 2.6 percent to 54.85 euros, the lowest price in a month. Aluminum, copper, lead, nickel, tin and zinc all fell on the London Metal Exchange today.

Deutsche Bank and Commerzbank, Germany’s biggest banks, lost 1.8 percent to 40.29 euros and 3.3 percent to 5.41 euros, respectively. European banking shares dropped 1.9 percent today amid reports that Portugal may be forced to seek a bailout.

QSC, Symrise

QSC AG slumped 5 percent to 3.36 euros, erasing a 3.4 percent rise on Jan. 7. The telecommunications company was cut to “sell” from “buy” at DZ Bank AG, which said it doesn’t expect “any organic growth” for 2011 and 2012 and sees “potential for disappointment” in the initial free cashflow guidance.

Puma AG dropped 2.6 percent to 230.20 euros, a sixth day of declines for the longest falling streak since August. The sporting-goods maker controlled by PPR SA was downgraded to “sell” from “hold” at UniCredit SpA.

Bijou Brigitte Modische Accessoires AG sank 5 percent to 109.30 euros, the biggest retreat since August. The company said it expects profit to decline for 2010 after sales for the year fell by 3.1 percent to 378 million euros.

Symrise AG soared 2.7 percent to 20.23 euros. The German maker of lemons scents and vanilla flavoring rose as DuPont Co. agreed to acquire Danisco A/S, the Danish maker of food ingredients.

Singulus jumped 2.3 percent to 4.30 euros as the company won a follow-on order from a European maker of CIS thin-film solar cells for five more selenization systems worth more than 30 million euros ($38.7 million).

To contact the reporter on this story: Julie Cruz in Frankfurt at jcruz6@bloomberg.net.

To contact the editor responsible for this story: David Merritt at dmerritt1@bloomberg.net.

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