German stocks fell for a second day amid speculation the Federal Reserve will ease its bond-buying program as soon as next month.
Salzgitter AG (SZG) slid 3.8 percent as Morgan Stanley and Citigroup Inc. cut their recommendations on the steelmaker. Continental AG (CON) retreated 1.3 percent after MainFirst Bank AG downgraded the tiremaker’s shares. GSW Immobilien AG (GIB) surged by a record after Deutsche Wohnen AG (DWNI) offered to buy Berlin’s biggest publicly traded residential landlord in an all-share transaction. Deutsche Wohnen lost 4.7 percent.
The DAX Index (DAX) sank 0.8 percent to 8,300.03 at the close of trading in Frankfurt. The benchmark gauge has fallen 2.7 percent from its all-time high on May 22 as Fed Chairman Ben S. Bernanke said the U.S. central bank could pare stimulus measures if the world’s largest economy improves in line with forecasts. The broader HDAX Index also declined 0.8 percent today.
“Momentum is fading on stocks today as tapering in the U.S., growth concerns in Asia and a stagnant economy in Europe are on the minds of equity investors,” Daniel Weston, a portfolio manager at Aimed Capital GmbH in Munich, wrote in an e-mail.
Minutes of the Fed’s July 30-31 meeting to be released tomorrow may indicate when central bankers plan to trim purchases of $85 billion of debt a month. Officials will probably begin to reduce the buying next month, according to 65 percent of economists surveyed by Bloomberg on Aug. 9-13.
Salzgitter, Germany’s second-biggest steelmaker, lost 3.8 percent to 28.34 euros. Citigroup downgraded the shares to neutral from buy, citing overcapacity that may limit price increases. Morgan Stanley cut the stock to underweight, similar to a sell rating, from equal weight, saying the shares have “run materially ahead of fundamentals.”
Continental, Europe’s second-largest auto-parts maker, lost 1.3 percent to 117.65 euros as MainFirst downgraded the shares to underperform from outperform.
Preferred shares of Volkswagen AG led automakers lower, falling 1.8 percent to 180.70 euros. Porsche SE slid 2.3 percent to 66.16 euros. Daimler AG (DAI), the world’s third-biggest luxury-vehicle maker, declined 1 percent to 54.59 euros. Bayerische Motoren Werke AG slid 1.3 percent to 74.05 euros.
HeidelbergCement AG (HEI), the third-largest maker of cement, lost 2.5 percent to 54.42 euros. Industry peer CRH Plc pared its second-half earnings guidance, citing weak demand from the euro region. HeidelbergCement slid 4 percent yesterday as UBS AG downgraded Swiss rival Holcim Ltd.
GSW Immobilien surged 6.3 percent to 33.45 euros, the biggest gain since its initial public offering in April 2011. Deutsche Wohnen will offer 51 new shares for every 20 GSW shares, valuing GSW’s equity at about 1.75 billion euros ($2.3 billion), according to a statement today.
Deutsche Wohnen said GSW will own about 43 percent of the combined company if all shareholders accept the offer. Shares in Deutsche Wohnen, which has 90,000 apartments across Germany, tumbled 4.7 percent to 13.49 euros, its biggest decline since May 2012.
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