German stocks climbed, with the benchmark DAX Index trimming a weekly decline, as carmakers rallied and a report showed confidence among U.S. consumers rose more than forecast this month.
Volkswagen AG jumped 6.2 percent after saying profit surged sevenfold last year on demand in China, and forecast growth will accelerate this year. MAN SE gained 4.3 percent as the Financial Times Deutschland said Volkswagen has pressurized Scania AB to make a bid for the truckmaker. Deutsche Telekom AG fell 1.8 percent as Europe’s largest telecommunications company reported a surprise fourth-quarter loss.
The DAX rose 0.8 percent to 7,185.17 at the 5:30 p.m. close in Frankfurt. The gauge has retreated 3.3 since peaking at the highest level since January 2008 at the end of last week. The measure had its biggest weekly drop since July, trimming this year’s advance to 3.9 percent. The broader HDAX Index added 0.9 percent today.
“The correction was overdue,” said Matthias Jasper, head of equities at WGZ Bank AG in Dusseldorf. “The markets are very nervous and driven by political uncertainty at the moment, but I am not overly concerned. I expect ongoing support from the macro-economic side. The best thing is to remain invested in equities.”
Stocks slumped this week after Libyan leader Muammar Qaddafi’s violent response to anti-government protests triggered the largest weekly gain in oil prices in two years. In the six weeks since Tunisia’s Zine El Abidine Ben Ali fled his country, popular uprisings across the Middle East and North Africa have unseated Egypt’s Hosni Mubarak and threaten to do the same to Qaddafi.
German equities extended their gains today as the Thomson Reuters/University of Michigan final sentiment index of U.S. consumer confidence climbed to 77.5 in February from 74.2 in January. Economists had predicted an increase to 75.5, according to the median forecast in a Bloomberg News survey.
Volkswagen surged 6.2 percent to 119.40 euros, the biggest gain in four months. Net income increased to 6.84 billion euros ($9.41 billion) from 960 million euros, Europe’s largest carmaker said. Profit beat the 4.96 billion-euro average estimate of six analysts surveyed by Bloomberg. Revenue rose 21 percent to 126.8 billion euros.
BMW and Daimler, the world’s biggest makers of luxury cars, climbed 3 percent to 58.70 euros and 1.2 percent to 51.07 euros, respectively. Automakers were the best performers among 19 industry groups in the benchmark Stoxx Europe 600 Index today.
MAN advanced 4.3 percent to 89.50 euros, the first gain in three days. VW supervisory board Chairman Ferdinand Piech is pressuring Swedish truckmaker Scania to make an offer for MAN by April or May at the latest, Financial Times Deutschland reported, citing unidentified people close to the situation. VW owns stakes in both companies
Deutsche Telekom lost 1.8 percent to 9.74 euros, the lowest price this month. The company posted a net loss of 582 million euros, compared with a loss of 3 million euros a year earlier. Analysts had predicted net income of 546 million euros. Adjusted earnings before interest, taxes, depreciation and amortization dropped to 4.55 billion euros in the fourth quarter, missing the 4.7 billion-euro average estimate of 19 analysts compiled by Bloomberg.
Fuchs Petrolub AG soared 2.7 percent to 98.77 euros. The maker of lubricants proposed a 59 percent increase in the annual dividend on its preferred shares and a 61 percent boost to the payout on its ordinary shares after “a strong increase in revenues and profits in 2010.”
United Internet AG gained 4.2 percent to 12.28 euros, the biggest advance in almost three months. Warburg Pincus, a private-equity investor, bought 5.29 percent of United Internet, the company said today, without giving financial details. That stake has a value of about 150 million euros.
Sugar refiner Suedzucker AG rose 3.2 percent to 20.64 euros as the European Union said it plans to release 500,000 tons of non-quota sugar onto EU markets.