German Stocks Advance on Cyprus Rescue Agreement
German stocks advanced after Cyprus agreed to a rescue package, lowering the risk of default and an exit from the euro currency union.
The DAX (DAX) Index rose 1.1 percent to 7,996.28 at 9:22 a.m. in Frankfurt, after last week falling for the first time in a month. The broader HDAX Index also added 1.1 percent today.
Cyprus bowed to demands to shrink its banking system in exchange for a 10 billion-euro ($13 billion) bailout. President Nicos Anastasiades agreed to shut the country’s second-largest bank under pressure from a German-led bloc of creditors.
The revised accord spares bank accounts with less than the insured limit of 100,000 euros. A loss of no more than 40 percent will be imposed on uninsured depositors at the Bank of Cyprus, two European Union officials said. Uninsured depositors at Cyprus Popular would largely be wiped out, two other officials said.
Deutsche Bank, Germany’s biggest lender, advanced 1.5 percent to 32.87 euros. Commerzbank, the country’s second- largest, climbed 1.4 percent to 1.20 euros. Bank shares in the Stoxx Europe 600 Index rose 1.2 percent for the third-best performance among the 19 industry groups.
HeidelbergCement AG (HEI), the world’s third-largest maker of cement, jumped 2.4 percent to 57.41 euros for the biggest gain in the DAX.
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