German Stocks Rise as Merkel Meets Greek Prime Minister
German stocks rose, rebounding from earlier losses, as Chancellor Angela Merkel said Greece must stick to its commitments to stay in the euro area, and a news report said the European Central Bank is considering setting yield band targets.
Bayer AG jumped 1.3 percent. Linde advanced 1.2 percent as the company was named among European chemical companies which may look at mergers and acquisitions within the next year. Volkswagen AG (VOW) slipped 2.2 percent, following a gauge of European carmakers lower.
The DAX Index (DAX) gained 0.3 percent to 6,971.07 at the close of trade in Frankfurt, paring its weekly loss to 1 percent. The measure has still rallied 17 percent from this year’s low on June 5 as European Central Bank President Mario Draghi said he would do everything possible to preserve the euro. The broader HDAX Index rose 0.2 percent today.
“We need clear decisions,” said Robert Halver, head of capital markets research at Baader Bank AG in Frankfurt. “There is a possibility that Greece will leave the euro zone in October. Preparations for a Greece exit, and a subsequent domino effect are running. Markets need to know what the face of the new euro zone and policy will be.”
Merkel said that Germany is ready to help the Greek government as it takes the necessary steps to resolve its economic woes, rebuffing European critics who advocate Greece’s exit from the euro.
“I am deeply convinced that the new government under the leadership of Prime Minister Samaras will do what it takes to solve the problem in Greece,” Merkel said at a joint press conference withSamaras in Berlin today. “I want Greece to stay in the euro zone and that’s what I’m working for.”
The ECB is considering setting yield band targets under a new bond-buying programme, Reuters reported, citing unnamed central bank people.
Bayer, Germany’s largest drugmaker, jumped 1.3 percent to 61.46 euros.
Linde, the world’s second-biggest maker of industrial gases, advanced 1.2 percent to 125.05 euros. Deutsche Bank AG (DBK) said the stock is one of a number of European chemical companies that may look at mergers and acquisitions within the next six to 12 months for profit growth.
Beiersdorf AG (BEI) climbed 1.1 percent to 57.14 euros as the stock was highlighted as being among those with above average potential for margin expansion in weak growth environment by Exane BNP Paribas.
Volkswagen, Europe’s biggest car manufacturer, fell 2.2 percent to 142.60 euros. Bayerische Motoren Werke AG, the largest maker of luxury vehicles, declined 1.3 percent to 60.05 euros. A gauge of carmakers posted the biggest drop of the 19 industry groups on the Stoxx Europe 600 Index. (SXXP)
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