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German Stocks Gain as Investors Await ECB Policy Decision

Nov. 6 (Bloomberg) -- German stocks advanced to a record, rebounding from yesterday’s decline, as investors awaited this week’s monetary-policy decision from the European Central Bank, and data showed factory orders increased more than forecast.

Bayerische Motoren Werke AG rose 1.2 percent, following European carmakers higher. Axel Springer AG gained 2 percent after reporting quarterly revenue that exceeded forecasts. K+S AG fell the most on the DAX Index, losing 3.7 percent after Moody’s Investors Service downgraded its rating on Europe’s biggest potash distributor to junk.

The DAX climbed 0.4 percent to 9,040.87 at the close of trading in Frankfurt. The benchmark gauge has risen 19 percent this year as central banks around the world pledged to leave interest rates low for a prolonged period. The broader HDAX Index added 0.5 percent today.

“Investors are expecting some very dovish comments from the ECB tomorrow,” Christoph Hock, an equity sales trader at Alpha Wertpapierhandels GmbH in Frankfurt, said in an e-mail. “There is speculation about a rate cut and a new long-term refinancing operation on the cards for December.”

Three of 70 economists’ estimates compiled by Bloomberg predict the European Central Bank will reduce its benchmark interest rate to 0.25 percent at its policy meeting tomorrow, while eight of 38 respondents in a separate survey forecast a cut in December.

Factory Orders

German factory orders increased in September more than estimated, data released today by the Economy Ministry in Berlin showed. Orders, adjusted for seasonal swings and inflation, jumped 3.3 percent from August, when they fell 0.3 percent. Economists forecast a gain of 0.5 percent, according to the median of 37 estimates in a Bloomberg News survey.

BMW, the world’s biggest manufacturer of luxury cars, rose 1.2 percent to 82.16 euros. A gauge of automakers was among the best performers of the 19 industry groups on the Stoxx Europe 600 Index.

Axel Springer climbed 2 percent to 44.28 euros. Europe’s biggest newspaper publisher said third-quarter revenue rose 3.6 percent to 815.8 million euros ($1.1 billion), beating analysts’ estimates of 808 million euros, as growth in its digital media business offset lower sales at its print operations.

HeidelbergCement AG, the world’s third-largest maker of cement, added 1.3 percent to 59.12 euros, for the second-biggest gain on the DAX, as a measure of European construction-related stocks climbed on the Stoxx 600.

K+S AG fell 3.7 percent to 20.05 euros. Moody’s downgraded the company to Ba1 from Baa2, citing price uncertainty in the global potash market and plans to invest in its Canadian mine, which could necessitate raising additional debt.

To contact the reporter on this story: Jonathan Morgan in Frankfurt at jmorgan157@bloomberg.net

To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net

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