Sept. 12 (Bloomberg) -- RWE AG rose the most among companies on Germany’s DAX Index, erasing an earlier loss, as investors who had bet against the country’s largest power generator reversed their positions.
RWE climbed 3.3 percent to 25.89 euros in Frankfurt, the highest closing price in 12 weeks, extending its gain in the past week to 18 percent. Trading volumes were four times the three-month daily average.
“Many investors had a short position,” Stephan Wulf, an analyst at Warburg Research GmbH in Hamburg, said today by telephone. Uncertainty surrounding Germany’s Sept. 22 federal elections has led them to be more “neutral,” he said.
Some politicians have signaled they’ll seek to change clean-power subsidies after the vote to cut costs for consumers after renewable-energy projects proliferated, driving up energy bills. The Monopolkommission, a government adviser, this month urged Germany to rein in the payments, potentially boosting the competitiveness of conventional power and buoying RWE.
EON SE, RWE’s larger German competitor, rose 2.3 percent to close at 13.755 euros in Frankfurt. Both utilities have also gained on power prices that have advanced almost 6 percent this month.
“It helps utilities that the power prices increased,” according to Wulf, who has a buy recommendation on Essen-based RWE and a price estimate of 28 euros.
RWE fell as much as 4.3 percent earlier today following media and analyst reports that the company may cut dividends.
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