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German Stocks Climb as GDP Growth Beats Estimates

German stocks rose, snapping four days of losses, as economic growth in Europe’s largest economy slowed less than economists had forecast.

Merck KGaA (MRK) advanced 4.2 percent after it raised its full- year earnings forecast. Hochtief AG (HOT) lost 2.3 percent after saying profit targets for the year have become more challenging.

The DAX Index (DAX) gained 0.9 percent to 6,974.39 at the close of trading in Frankfurt. The DAX has rallied 17 percent from this year’s low on June 5 as central banks around the world took steps to bolster economic growth. The broader HDAX Index also added 0.9 percent today.

“In light of the fairly weak data seen in recent months which has suggested that the German economy is finally feeling the pinch from the European financial crisis, the GDP figures are very respectable and proving once again just how resilient the German economy is,” said Markus Huber, head of German sales trading at ETX Capital in London.

German economic growth slowed less in the second quarter than economists had forecast. Gross domestic product rose 0.3 percent from the first quarter, when it gained 0.5 percent, the Federal Statistics Office said. Economists had predicted a 0.2 percent increase, according to the median of 40 estimates in a Bloomberg News survey.

France’s GDP was unchanged in the quarter, better than the 0.1 percent decline that economists had forecast.

Investor Confidence

A measure of German investor sentiment unexpectedly dropped for a fourth consecutive month, sliding to its lowest level since December.

The ZEW Center for European Economic Research in Mannheim said its index of investor and analyst expectations, which aims to predict economic developments six months in advance, fell to minus 25.5 from minus 19.6. Economists had forecast a reading of minus 19.3, according to the median of 28 estimates in a Bloomberg News survey.

A U.S. Commerce Department release showed that retail sales rose in July more than economists had estimated.

Merck gained 4.2 percent to 86 euros. The German maker of the cancer drug Erbitux raised its full-year forecast after second-quarter profit rose 14 percent.

For 2012, earnings before interest, taxes, depreciation and amortization, excluding one-time items, will reach 2.85 billion euros ($3.5 billion) to 2.95 billion euros, Merck said. That compares with a previous prediction of 2.8 billion euros to 2.9 billion euros.

Wirecard, TUI

Wirecard AG rose 1.1 percent to 15.88 euros, snapping a four-day retreat. The maker of electronic-payment and risk- management software reported second-quarter profit of 17.2 million euros from 13.1 million euros during the same period last year.

TUI AG (TUI1) jumped 4.4 percent to 5.64 euros, rising for a fourth day. The owner of Europe’s largest travel company boosted the full-year forecast for its hotel unit after lifting prices and lowering costs.

Celesio AG gained 1.7 percent to 14.39 euros. The German drug wholesaler said first-half operating profit rose after writing down units sold and those still to be disposed and stuck to its forecast for the year after adjusting year-ago figures.

Conergy AG surged 5.7 percent to 50.4 euro cents. The German solar-energy company posted its first operating profit in almost two years.

Hochtief declined 2.3 percent to 40 euros. Germany’s largest builder said profit targets for the year have become more challenging after it set aside money for a delayed concert- hall project and its loss widened in the second quarter.

The volume of shares changing hands on DAX companies was 36 percent lower than the average of the past 30 days, data compiled by Bloomberg showed.

To contact the reporter on this story: Tom Stoukas in Athens at astoukas@bloomberg.net

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

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