German stocks advanced as investors gauged the prospects for the continuation of a rally that lifted the benchmark DAX Index to a record last week.
Wacker Chemie AG, Europe’s largest polysilicon producer, rose 5.7 percent as the substance climbed to its highest price since October 2012. K+S AG, the region’s biggest potash supplier, increased 2.2 percent after its worst drop in seven weeks. Deutsche Bank AG gained 0.9 percent after Equinet AG recommended buying the stock.
The DAX rose 0.4 percent to 9,435.15 at the close of trading in Frankfurt, paring the loss this week to 1.6 percent. The benchmark gauge rallied 25 percent in 2013 and reached a record on Dec. 27, as the European Central Bank pledged to keep interest rates low for a prolonged period and after the Federal Reserve’s decision to slow the pace of its bond-buying program increased investors’ confidence in the U.S. economic recovery. The broader HDAX Index climbed 0.4 percent today and the Stoxx Europe 600 Index advanced 0.6 percent.
“I don’t see what would be the catalyst for a correction,” Joost van Leenders, who helps oversee about $654 billion as a strategist at BNP Paribas Investment Partners in Amsterdam, said by telephone. “I would expect equities to continue the positive trend.”
A report showed Spanish unemployment dropped the most in six months in December. In China, the non-manufacturing Purchasing Managers’ Index fell to 54.6 last month, the lowest since August, and down from 56 a month earlier, data from the National Bureau of Statistics and the China Federation of Logistics and Purchasing showed today. A number higher than 50 indicates expansion.
Wacker Chemie rose 5.7 percent to 84.56 euros. The average spot price for polysilicon used in solar cells rose 2.3 percent from a week earlier to $19.38 per kilogram, PV Insights said on its website. That extended the previous week’s 4 percent increase to reach the 14-month high.
K+S gained 2.2 percent to 22.09 euros, posting the biggest rally in the DAX. It lost 3.4 percent yesterday after Bank of America Corp. said the stock may trail the broader market in the first quarter.
Deutsche Bank, Germany’s biggest lender, increased 0.9 percent to 34.40 euros. Equinet raised its recommendation to buy from hold, saying litigation risks are reduced and the impact of remaining legal cases shouldn’t be significant for the lender’s earnings. The broker, which predicted “good” financial results for Deutsche Bank’s first quarter, increased its share-price estimate to 42 euros from 34 euros.
Commerzbank AG, Germany’s second-largest bank, fell 1.6 percent to 11.29 euros for the biggest DAX decline.