Germany's DAX Index Climbs to Two-Year High; Deutsche Post Leads Advance
German stocks advanced, pushing the benchmark DAX Index to a two-year high, as Deutsche Post AG reported earnings that topped estimates.
Deutsche Post, Europe’s largest postal service, rallied 4.1 percent after also raising the lower end of its profit forecast. Volkswagen AG and Porsche SE both gained more than 2 percent after Lower Saxony Prime Minister David McAllister said the merger risks are “manageable.” ThyssenKrupp AG followed metal prices higher.
The DAX rose 0.6 percent to 6,787.81 at the 5:30 p.m. close in Frankfurt. The measure increased 2.3 percent last week as the U.S. Federal Reserve announced it will buy a further $600 billion of bonds in an attempt to bolster the world’s largest economy. The broader HDAX Index gained 0.5 percent today.
“Many companies are coming out with good figures and positive announcements,” said Heinz-Gerd Sonnenschein, an equity strategist at Deutsche Postbank AG in Bonn. “Deutsche Post earnings show worldwide logistics companies are on track.”
Deutsche Post rallied 4.1 percent to 13.80 euros, the largest advance in six months. Third-quarter net income was 226 million euros ($313 million), compared with a loss of 83 million euros a year earlier, the Bonn-based company said. The average estimate of five analysts compiled by Bloomberg was for a profit of 215 million euros.
Volkswagen and Porsche rose 2.4 percent to 111.45 and 7.2 percent to 43.54 euros, respectively. Europe’s largest carmaker’s merger with Porsche is unlikely to be derailed by U.S. investor lawsuits, even though its completion in 2011 appears “doubtful,” according to the German state shareholder with veto power.
“It’s a very complicated process,” McAllister said in an interview in Berlin. “I consider the judicial and financial risks from the U.S. to be manageable. Nevertheless, caution should take priority over haste, thoroughness over speed.”
Bayerische Motoren Werke AG added 2.8 percent to 54.91 euros as the world’s biggest maker of luxury cars said group unit sales rose 12 percent in October to 128,593 cars and sport- utility vehicles. Namesake brand sales also gained 12 percent.
ThyssenKrupp, Germany’s biggest steelmaker, gained 1.9 percent to 28.38 euros as aluminum, copper, lead, nickel, tin and zinc climbed on the London Metal Exchange.
Adidas AG surged 3.2 percent to 48.52 euros, the highest close since January 2008. The world’s second-largest sporting- goods maker has been trying out sales of a cheap shoe in Bangladesh in an effort to boost its social responsibility image and test new markets, Handelsblatt reported, citing an unidentified company spokesman.
The company said yesterday it aims to increase sales as much as 50 percent in the next five years.
Wincor Nixdorf AG jumped 8.2 percent to 56.95 euros, the highest close since January 2008. The maker of automated teller machines forecast an increase in operating profit and net sales for the financial year 2010-2011. The stock was raised to “add” from “hold” at Commerzbank AG, which said the company “should benefit over-proportionally from a recovery of the European business.”
DIC Asset AG dropped 2.7 percent to 7.56 euros as the commercial property company said nine-month profit slid to 9.5 million euros from 11.5 million euros.
To contact the editor responsible for this story: David Merritt at firstname.lastname@example.org.