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Bekaert Falls Most in Five Months in Brussels on Slow China

Bekaert Falls Most in Five Months in Brussels on Slow China

Bekaert NV, the largest maker of steel cord used in tires, declined the most in five months in Brussels trading after saying Chinese demand began to slow and it will cut prices to defend against rising local competition.

Bekaert tumbled 5.3 percent on Euronext Brussels, the biggest drop since Dec. 9. Chinese demand weakened toward the end of the first quarter and it’s getting tougher to pass on rising raw-material costs, Bekaert said today in a statement.

The company will implement “adequate price adjustments” in China after Xingda International Holdings Ltd. in December began mass production of sawing wire used to slice silicon ingots into wafers for solar cells, it said.

“Bekaert confirms that the second half might be more difficult, with a slowdown in some markets and increasing competition,” said Bernard Hanssens, an analyst at Banque Degroof SA in Brussels who has an “accumulate” rating on the stock. This stops investors being “over-optimistic,” he wrote.

Bekaert, based in Zwevegem, Belgium, fell 4.39 euros to

79.15 euros by the 5:35 p.m. close in Brussels. The shares have lost 7.9 percent since the start of the year, compared with a

4.8 percent gain for Xingda in Hong Kong trading.

The company reported first-quarter sales rose 32 percent to 918 million euros ($1.3 billion) as demand increased in every region and higher wire-rod prices were passed onto customers.

Asia-Pacific sales growth slowed to 46 percent from 67 percent in the previous three months. Bekaert’s higher-margin products including steel cord for tires and sawing wire contribute about 80 percent of the company’s Asian sales.

(Updates with closing share price in fifth paragraph.)