German Stocks Gain after Increase in Manufacturing PMI
German stocks advanced, rebounding after three days of losses, as data showed manufacturing in Europe’s biggest economy expanded in August at a faster-than-expected pace.
Drillisch AG (DRI), a provider of telephone services, surged 4.9 percent after Berenberg Bank upgraded the shares. Stroer Media AG, a provider of online advertising, jumped 5.9 percent after reporting an increase in first-half operating earnings before interest, taxes, depreciation and amortization.
The DAX Index (DAX) climbed 1.2 percent to 8,381.31 at 10:07 a.m. in Frankfurt. The gauge has rallied 8.9 percent from its low on June 24 as the European Central Bank said that interest rates will remain low for an extended period. The broader HDAX Index added 1.1 percent today.
“The DAX futures opened down after a poor U.S. close last night but better manufacturing PMIs from China and Germany helped turn around the market,” Ion-Marc Valahu, co-founder and fund manager at Clairinvest in Geneva, wrote in an e-mail.
Germany’s Manufacturing Purchasing Managers’ Index rose to 52 in August from 50.7 in July, according to a preliminary report from Markit Economics. Economists had forecast a reading of 51.1 for this month.
A gauge of Chinese manufacturing rose in August from an 11-month low. The preliminary reading of 50.1 for a PMI Index (EC11FLAS) released today by HSBC Holdings Plc and Markit compares with a final figure of 47.7 in July. The number beat all 16 estimates in a Bloomberg News survey and was the first reading since April above the 50 mark that divides contraction from expansion.
In the U.S., the Federal Open Market Committee’s minutes from the July 30-31 gathering released yesterday showed officials were “broadly comfortable” with Chairman Ben S. Bernanke’s plan to start reducing bond buying later this year if the economy continues to improve, with several members saying tapering might be needed soon.
A U.S. Labor Department report at 8:30 a.m. in Washington will show initial claims for unemployment benefits rose to 330,000 last week from 320,000 in the preceding week, according to the median estimate of economists surveyed by Bloomberg.
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