German Stocks Climb as U.S. Data Eases Stimulus Concern

German stocks rose the most in five weeks as data showed that hiring and unemployment both increased in the U.S., spurring investors to speculate the Federal Reserve will not scale back stimulus measures immediately.

Deutsche Telekom AG rose 1.9 percent as Jefferies Group Inc. advised investors to buy the shares. MAN SE climbed after its supervisory-board chairman said he expects legal challenges to the price offered by Volkswagen AG for the truckmaker. Lanxess AG fell 1.5 percent.

The DAX Index gained 1.9 percent to 8,254.68 at the close of trading in Frankfurt. The equity benchmark still lost 1.1 percent this week on earlier concern that the Fed will start to taper its bond-purchase program in September. The broader HDAX Index added 1.8 percent today.

A Labor Department report showed U.S. payrolls rose 175,000 last month after a revised 149,000 increase in April that was smaller than first estimated. The median forecast in a Bloomberg survey called for a 163,000 gain. The unemployment rate rose to 7.6 percent from 7.5 percent.

Federal Reserve Chairman Ben S. Bernanke said in May the central bank could curtail its bond buying if the job market improved in a “real and sustainable way.”

In Germany, industrial production increased in April by the most in 13 months. Production jumped 1.8 percent percent from March, when it gained 1.2 percent, the Economy Ministry in Berlin said. That was the strongest gain since March last year. Economists surveyed by Bloomberg News forecast no change.

Deutsche Telekom

Deutsche Telekom advanced 1.9 percent to 8.84 euros after Jefferies Group Inc. upgraded Europe’s second-largest telephone company to buy from hold and said the stock price may reach 9.70 euros in 12 months.

MAN advanced 0.9 percent to 83.95 euros. Ferdinand Piech, supervisory board chairman at both MAN and Volkswagen, said he expects a legal battle with minority shareholders seeking a higher price than what VW is offering for the rest of German truckmaker.

Gagfah SA, the second-biggest owner of German homes, added 4.7 percent to 9.75 euros after JPMorgan Chase & Co. upgraded the shares to neutral from underweight.

Munich Re, the world’s largest reinsurer, climbed 3.8 percent to 142.65 euros. Nomura Holdings Inc. said European insurers will see losses of 2 billion euros to 3 billion euros this year from the impact of floods. That would be less than the 3.4 billion euros lost after the 2002 deluge.

Lanxess lost 1.5 percent to 55.89 euros. European chemical makers may fail to witness a sharp increase in prices for their products, JPMorgan Chase & Co. said in a note. Low consumer confidence is also hurting sales and profit margins in the industry, JPMorgan said.

Patrizia Immobilien AG, a real estate company, dropped 2.6 percent to 8.50 euros after JPMorgan downgraded the shares to underweight, a rating similar to sell, from neutral. The brokerage said the stock price offers less room for an increase than the wider market.

Before it's here, it's on the Bloomberg Terminal.