July 19 (Bloomberg) -- German stocks declined, paring a weekly gain, as the People’s Bank of China said it will remove a floor on lending rates from tomorrow.
SAP AG, the world’s largest maker of business-management software, fell 2.3 percent, contributing the most to a decline by technology stocks. TUI AG slipped 1.6 percent after Commerzbank AG lowered its recommendation on the shares.
The DAX Index declined 0.1 percent to 8,331.57 at the close of trading in Frankfurt, having earlier lost as much as 0.6 percent. The equity benchmark has climbed 8.3 percent from a low on June 24 and has risen 1.5 percent this week. The broader HDAX Index also retreated 0.1 percent today.
“Given the news from China, investors can be excused for being cautious and taking profits moving into the weekend,” Daniel Weston, a portfolio manager at Aimed Capital GmbH in Munich, wrote in e-mailed comments.
The PBOC said it will remove the floor on lending rates, enabling financial institutions to offer more competitive loans. Last year, the central bank allowed them to lend at a discount of as much as 30 percent below the benchmark lending rate. The PBOC will also remove the cap on rates offered by rural cooperatives, according to a statement on its website.
A gauge of European technology companies fell 0.7 percent as Google Inc., owner of the world’s most popular Internet search engine, reported second-quarter sales and profit yesterday that missed analysts’ estimates. Microsoft Corp. posted fiscal fourth-quarter profit yesterday that trailed analysts’ estimates.
SAP retreated 2.3 percent to 55.73 euros. JPMorgan Chase & Co. downgraded the shares to neutral from overweight, meaning that investors should not increase their holdings.
TUI, the owner of Europe’s largest travel company, slipped 1.6 percent to 9.23 euros after Commerzbank cut the stock to hold from buy.
Deutsche Lufthansa AG, Europe’s second-largest airline, rose 1.4 percent to 15.56 euros after Bankhaus Lampe KG upgraded the shares to buy from hold.
The volume of shares changing hands in companies listed on the DAX was 9.3 percent greater than the average of the past 30 days, according to data compiled by Bloomberg.
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