German Stocks at Record After Consumer Confidence ReportNamitha Jagadeesh
German stocks rose to an all-time high as Chancellor Angela Merkel reached a coalition agreement and as a gauge of consumer confidence in Europe’s largest economy beat forecasts.
HeidelbergCement AG gained 1.4 percent after Berenberg Bank recommended buying the shares. Deutsche Post AG climbed 3.5 percent for the biggest gain on the benchmark DAX Index after saying the coalition’s minimum wage requirement won’t hurt its results. Nordex SE fell 5.1 percent after the wind-turbine maker sold shares.
The DAX advanced 0.7 percent to 9,351.13 at the close in Frankfurt, its highest level ever. The benchmark gauge has surged 23 percent this year as central banks around the world pledged to leave interest rates low for a prolonged period of time. The broader HDAX Index gained 0.6 percent today.
“The consumer-confidence data show Germany is on the road to prosperity,” said Jacques Porta, who helps oversee about $780 million as a fund manager at Ofi Gestion Privee in Paris. “The stocks rally in Germany this year is merited, its economy is competitive and efficient. The coalition agreement is good news, and it will continue Germany’s political stance in European policies.”
Merkel reached an accord with the Social Democrats, putting her on track for a third term leading Germany. The agreement still has to be approved in a ballot of the SPD’s 470,000 members.
The number of shares changing hands in companies listed on the DAX was 28 percent lower than the average of the past 30 days, data compiled by Bloomberg show.
A report by research company GfK AG indicated that German consumer confidence will rise to 7.4 in December from a revised 7.1 this month. The median estimate of economists in a Bloomberg survey had called for a reading of 7.1.
In the U.S., a report from the Commerce Department showed durable-goods orders fell 2 percent in October, matching the median forecast of economists in a Bloomberg survey, after rising 4.1 percent in the prior month.
A separate report showed first-time jobless claims in the week ended Nov. 23 declined to 316,000, the fewest in two months. The median forecast in a Bloomberg survey called for an increase to 330,000.
The Thomson Reuters/University of Michigan final index of consumer sentiment unexpectedly climbed to 75.1 this month from 73.2 in October. That compares with the median economist forecast of 73.1 and a preliminary reading of 72.
HeidelbergCement rose 1.4 percent to 56.41 euros as Berenberg Bank raised its rating on the cement maker to buy from hold, citing that its exposure to the Indonesian market may help the company.
Deutsche Post climbed 3.5 percent to 25.71 euros, extending its rally this year to 55 percent. Sebastian Steffen, a spokesman for Europe’s largest postal company, said the lowest hourly wages are 11.50 euros. Merkel’s agreement with SPD includes a policy to introduce a national minimum wage at 8.50 euros an hour, starting in 2015.
Adidas AG gained 1.1 percent to 89.55 euros after Bild Zeitung reported that the sports-goods maker maintained its position from last year as the favorite brand for Germans. The report cited a survey by Forsa.
Nordex dropped 5.1 percent to 10.34 euros after selling 7.35 million new shares for 10 euros a share. The stock has more than tripled this year.