Germany’s DAX Index Rallies to All-Time High on U.S. Data
Adidas surged to its highest price ever as its gross margin widened in the first quarter. Sky Deutschland AG (SKYD) jumped the most in five months after reporting an unexpected operating profit. ThyssenKrupp AG (TKA) climbed 7.1 percent after saying it is in “intense negotiations” with Vale SA and Brazilian authorities on the sale of its Steel Americas unit.
The DAX rose 2 percent to 8,122.29 at the close in Frankfurt, its highest level ever, according to data compiled by Bloomberg. The DAX was conceived as the successor to the Borsen- Zeitung Index with a historical time series extending back to 1959. As a performance index, it has been calculated only from December 1987. The benchmark’s previous highest close was reached on July 16, 2007.
“The U.S. jobs data shows that the economy continues to improve,” Raimund Saxinger, a fund manager at Frankfurt-Trust Investment GmbH, which oversees about $22 billion, said in a telephone interview. “But the rise in European markets may not be a rational reaction because this was a direction of the economy that we already knew about, and numbers being above expectations may be just noise.”
The DAX rallied 3.9 percent this week as the European Central Bank cut interest rates and investors speculated global policy makers will continue economic-stimulus measures. The broader HDAX Index rose 1.9 percent today.
In the U.S., employment picked up more than forecast in April and the jobless rate unexpectedly declined to a four-year low of 7.5 percent, data showed today.
Payrolls expanded by 165,000 workers last month following a revised 138,000 increase in March that was larger than first estimated, Labor Department figures showed in Washington. The median forecast of 90 economists surveyed by Bloomberg projected a 140,000 gain. Revisions to the prior two months’ reports added a total of 114,000 jobs to the employment count in February and March.
Adidas jumped 7.6 percent to 85.50 euros, its highest price since it sold shares to the public in November 1995. The world’s second-largest sporting-goods maker said net income climbed 6.5 percent to 308 million euros ($403 million). That beat the 298.5 million-euro average estimate in a Bloomberg survey. The gross margin widened to 50.1 percent from 47.7 percent. Analysts predicted a gross margin of 48.6 percent.
Sky Deutschland advanced 7.5 percent to 4.85 euros, the biggest increase since November. The German pay-television provider controlled by Rupert Murdoch’s News Corp. said first- quarter earnings before interest, taxes, depreciation and amortization were 5.8 million euros, compared with a 40.6 million-euro loss a year earlier. Analysts on average projected an Ebitda-level loss of 4.7 million euros.
ThyssenKrupp gained 7.1 percent to 14.33 euros, the biggest rally since November 2011. Germany’s biggest steelmaker said it is talking to Vale, Brazilian development bank BNDES and the government on the sale of Steel America operations.
Separately, UBS AG raised the stock to buy from sell.
Kloeckner & Co., Europe’s largest independent steel trader, rose 3.9 percent to 9.35 euros. Salzgitter AG (SZG), Germany’s second- biggest steelmaker, added 5.5 percent to 31.26 euros.
Hugo Boss AG (BOSS), the German luxury-clothing maker controlled by buyout firm Permira Advisers LLP, dropped 6.1 percent to 87.08 euros, the sharpest decline since Sept. 11, as Permira sold 7 million shares, or a 10 percent stake, in the company.
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