German Stocks Little Changed as Banks Offset Lufthansa
RWE AG (RWE), Germany’s second-largest utility, slipped 2.4 percent after RBC Capital Markets cut its recommendation on the stock. Lufthansa followed its European peers higher, recovering some of its Aug. 2 selloff. Xing AG (O1BC), the business social network, jumped the most since October as Deutsche Bank AG (DBK) upgraded its rating on the shares.
The benchmark DAX Index (DAX) fell 0.1 percent to 8,398.38 at the close of trading in Frankfurt, after earlier losing as much as 0.5 percent. The equity benchmark rose 2 percent last week, extending its 2013 advance to 10 percent as the Federal Reserve kept its monthly bond purchases unchanged. The broader HDAX Index dropped less than 0.1 percent today.
“After a strong performance during the last weeks we are seeing a consolidation in the market with extremely low volumes,” Soeren Steinert, who helps manage about $24 billion as associate director for equities trading at Quoniam Asset Management GmbH in Frankfurt, wrote in an e-mail.
RWE slipped 2.4 percent to 22 euros. RBC Capital Markets cut its rating on the stock to underperform, the equivalent of sell, from sector perform, and reduced its 12-month share-price estimate to 20 euros, citing the delayed impact of lower power prices on the company’s profit in 2014 and 2015. EON AG, the country’s largest utility, lost 1.1 percent to 12.60 euros.
Deutsche Bank, Germany’s biggest lender, slipped 0.8 percent to 34.24 euros, and Commerzbank AG (CBK), the second-largest, retreated 1.6 percent to 6.66 euros. A gauge of European banking stocks fell the most of the 19 industry groups the Stoxx Europe 600 Index.
Lufthansa added 1.2 percent to 14.84 euros as a measure of European travel and leisure stocks was among the best performers on the Stoxx 600. Europe’s second-largest airline last week said restructuring efforts are starting to pay off as an efficiency push helps improve earnings.
Xing rose 8.9 percent to 56.17 euros as Deutsche Bank upgraded the shares to buy from hold. Opportunities for growth have not been fully appreciated by the market, according to the bank, which cited Xing’s product portfolio and attractive market opportunities. The shares have a 30 percent upside potential, Deutsche Bank said.
Deutsche Boerse, operator of Frankfurt’s stock exchange, added 3.4 percent to 55.87 euros.
ProSiebenSat.1 Media AG, the broadcaster controlled by KKR & Co. and Permira Advisers LLP, advanced 0.9 percent to 33.47 euros as Liberum Capital upgraded the shares to buy, reversing a downgrade that it made on July 22. The brokerage said the company’s second-quarter results and commentary gave it more confidence about conditions in the German advertising market.
Solarworld AG (SWV) jumped 26 percent to 64 euro cents as creditors approved proposals to try to save Germany’s biggest solar-panel maker. A total of 99.96 percent of noteholders present in a meeting in Bonn today representing 35.78 percent of Solarworld’s 150 million-euros ($198.8 million) of bonds due July 2016 backed the restructuring plan, the company said in a statement.
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