German Stocks Climb as U.S. Unemployment Claims Decline

German stocks advanced for a second day, as a report showed applications for unemployment benefits in the U.S. fell more than forecast last week.

Bayerische Motoren Werke AG (BMW) climbed 1.6 percent after Baader Bank AG recommended that investors buy the shares. Adidas AG (ADS) gained 1.8 percent. ThyssenKrupp AG, Germany’s biggest steelmaker, fell to its lowest price since July after Russian peer Evraz Plc refrained from announcing a final dividend.

The DAX Index (DAX) rose 0.8 percent to 7,871.63 at the close of trading in Frankfurt. The benchmark surged 2.3 percent yesterday, the most since March 5, as Chinese imports beat forecasts amid investor expectations that central banks will continue stimulus measures. The broader HDAX Index also gained 0.8 percent today.

“We saw yesterday very aggressive short covering and we are seeing some follow-through from that today which can create a big squeeze in markets, particularly in periods of relative illiquidity,” Jeremy Batstone-Carr, head of research at Charles Stanley Group Plc in London, said in a telephone interview. “It is easy to ascribe an improvement in the markets to a hope that we will pull through this soft patch to a promised land.”

U.S. jobless claims decreased by 42,000 to 346,000 in the week ended April 6, from a revised 388,000, Labor Department figures showed today in Washington. The median forecast of 49 economists surveyed by Bloomberg called for a drop to 360,000.

ECB Report

The European Central Bank said today it will look for signs in economic data that inflation could slow more than it currently anticipates.

“In the coming weeks, the Governing Council will monitor very closely all incoming information on economic and monetary developments and assess any impact on the outlook for price stability,” the ECB said in its monthly bulletin. “The monetary policy stance will remain accommodative for as long as needed.”

BMW added 1.6 percent to 69.03 euros after Baader Bank resumed coverage of the shares with a buy rating, saying new products and growth in China will offset increased competition in Europe.

Adidas climbed 1.8 percent to 79.33 euros for a second day of gains. The world’s second-largest sporting-goods maker lost 5.6 percent from April 3 to April 9.

Deutsche Telekom AG advanced 2 percent to 8.78 euros after it sweetened the debt terms of an October proposal to merge its T-Mobile USA unit with MetroPCS Communications Inc. (PCS)

Debt Cut

Deutsche Telekom cut the amount of debt it’s imposing on the combined company by $3.8 billion, according to a statement from the Bonn-based company yesterday. The carrier also lowered the interest rate it plans to charge on the loan by half a percentage point.

Deutsche Lufthansa SA, Germany’s largest airline, rose 1.8 percent to 14.65 euros, following a gauge of European travel and leisure stocks higher. IAG SA Chief Executive Officer Willie Walsh, who led the company’s creation via a merger of British Airways and Spain’s Iberia, said he favors a further bout of consolidation to boost revenue while paring costs.

ThyssenKrupp fell 1.5 percent to 14.20 euros. Salzgitter AG, the country’s second-biggest steelmaker, slid 1.9 percent to 31.05 euros.

Evraz, Russia’s largest steelmaker, tumbled in London after its board of directors refrained from announcing a final dividend, citing deteriorating market environment and a weaker second-half performance.

The volume of shares changing hands in companies on the DAX was 14 percent lower than the average of the last 30 days, data compiled by Bloomberg showed.

To contact the reporter on this story: Namitha Jagadeesh in London at njagadeesh@bloomberg.net

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

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