German stocks declined for a fourth day after Federal Reserve officials signaled that the U.S. central bank may soon reduce bond purchases.
Beiersdorf AG fell 3.2 percent after the maker of Nivea skin cream reported first-half sales growth at its consumer unit that trailed some analysts’ estimates. Hannover Re added 3.5 percent after the world’s fourth-biggest reinsurer posted an increase in second-quarter profit that beat forecasts.
The benchmark DAX Index fell 0.5 percent to 8,260.48 at the close of trading in Frankfurt. The equity measure rose 2 percent last week, extending its 2013 advance to 10 percent, as the Fed kept its monthly bond purchases unchanged. The broader HDAX Index dropped 0.4 percent today.
“The market is cautious on concerns emanating from the Fed that we might see tapering, which is having an effect on sentiment,” Jeremy Batstone-Carr, head of research at Charles Stanley Group Plc in London, said in a telephone interview.
Fed Bank of Chicago President Charles Evans, a proponent of monetary stimulus, said late yesterday he would not rule out a decision to begin reducing bond purchases from September.
“We’ve seen good improvement in the labor market, there’s no question in my mind about that,” Evans said in a meeting with reporters in Chicago. “I’m still wanting to see greater evidence that it’s a sustainable improvement.”
Fed Bank of Dallas President Richard Fisher, one of the most vocal critics of quantitative easing, had said Aug. 5 that policy makers were “closer to execution mode” in considering the right time to begin reducing purchases.
German industrial production rose in June, adding to signs that growth in Europe’s largest economy accelerated in the second quarter. Output increased 2.4 percent from May, when it dropped a revised 0.8 percent, the Economy Ministry in Berlin said today. Economists forecast a gain of 0.3 percent, according to the median of 41 estimates in a Bloomberg News survey.
Beiersdorf retreated 3.2 percent to 68.23 euros after it reported first-half sales growth at its consumer unit that trailed some analysts’ estimates as European demand remained sluggish.
Salzgitter AG retreated 0.3 percent to 25.21 euros, paring earlier losses of as much as 2.9 percent. Shares have still fallen 11 percent so far this week. Germany’s second-biggest steelmaker will reduce its workforce of 25,000 by more than 1,000, according to a Sueddeutsche Zeitung report.
Brenntag AG slipped 3 percent to 119.20 euros. The world’s largest distributor of chemicals forecast annual earnings below analysts’ estimates, citing doubts about the global economy.
Earnings before interest, taxes, depreciation, amortization and one-time items will be in a range of 710 million euros to 735 million euros this year, the company said. Analysts were predicting operating Ebitda of 742.6 million euros.
Hannover Re added 3.5 percent to 58.69 euros after it posted a 29 percent increase in second-quarter profit, beating analysts’ estimates, on higher investment income.
Net income advanced to 186.3 million euros ($248.1 million) from 144 million euros a year ago, the Hanover, Germany-based company said today. That beat the 173.4 million-euro average estimate of nine analysts surveyed by Bloomberg.
Xing AG surged 11 percent to 69.91 euros, its highest price since at least December 2006. Shares have jumped 35 percent this week after Deutsche Bank AG upgraded its rating on Germany’s biggest professional network, saying opportunities have not been fully appreciated by the market.