German Stocks Advance as DAX Climbs for First Day in FiveInyoung Hwang
German stocks advanced, sending the DAX Index higher for the first time in five days, as investors weighed earnings results from Siemens AG to Software AG.
Siemens rose after Europe’s largest engineering company posted quarterly earnings that beat analysts’ estimates. BASF SE added 2 percent after increasing prices for polyetheramines. Software AG rallied 7.2 percent after reporting fourth-quarter profit. RWE AG fell 0.9 percent after saying it will write down 3.3 billion euros ($4.5 billion) when it reports 2013 earnings.
The DAX climbed 0.6 percent to 9,406.91 at the close of trading in Frankfurt. The benchmark gauge fell 3.9 percent in the four days through yesterday as the Argentinian government’s decision to let its currency devalue triggered a rout in emerging-market currencies. The broader HDAX Index added 0.9 percent today.
“Expectations had moved ahead of what the markets were delivering,” Frances Hudson, a strategist at Standard Life in Edinburgh, which oversees $294 billion, said by telephone. “We’re still seeing a little of that, but today it’s more about looking at individual company results.”
The volume of shares changing hands in companies listed on the DAX was 21 percent higher today than the average of the past 30 days, according to data compiled by Bloomberg.
In the U.S., a report in Washington showed orders of durable goods unexpectedly fell in December by the most in five months. Bookings for goods meant to last at least three years dropped 4.3 percent, exceeding the weakest forecast of 82 economists surveyed by Bloomberg, after a 2.6 percent gain in November that was smaller than previously reported.
A separate release showed the Conference Board’s consumer-confidence index rose to 80.7 in January from a revised 77.5 in December. The median economist estimate in a Bloomberg survey called for a reading of 78.
The Federal Reserve will begin its final two-day monetary-policy meeting under Chairman Ben S. Bernanke today. He leaves his post on Jan. 31. The central bank will probably reduce its monthly bond purchases in $10 billion increments over the next six meetings before announcing an end to the program no later than December, according to a Bloomberg survey this month.
Siemens added 1.6 percent to 98.94 euros after earlier falling as much as 1.6 percent. Europe’s largest engineering company said income from continuing operations jumped 21 percent to 1.39 billion euros in the three months through December. Fiscal first-quarter sales fell 3.3 percent to 17.3 billion euros. Chief Executive Officer Joe Kaeser said he expects Siemens’ markets to remain challenging in fiscal 2014.
BASF added 2 percent to 79.13 euros. The chemical company said it raised prices for polyetheramines in Europe by 15 euro cents per kilogram with immediate effect.
Software AG rallied 7.2 percent to 27.50 euros. Germany’s second-largest software maker posted fourth-quarter earnings before interest and taxes of 70.4 million euros, surpassing the 70.2 million euros estimated by analysts.
Bayerische Motoren Werke AG gained 1.4 percent to 81.53 euros, Volkswagen AG climbed 1.5 percent to 195.55 euros and Daimler AG rose 0.8 percent to 62.83 euros. A gauge of carmakers and auto-part manufacturers posted one of the biggest gains of the 19 industry groups in the Stoxx Europe 600 Index.
A measure of European banks was also one of the best performers on the European gauge. Commerzbank AG, Germany’s second-largest lender, increased 1.8 percent to 13 euros. Deutsche Bank AG, the biggest, added 0.7 percent to 36.88 euros.
SMA Solar Technology AG surged 9.2 percent to 31.30 euros. Deutsche Bank boosted its price target on the solar-energy company by 29 percent to 40 euros a share from 31 euros and maintained its buy rating. The bank said cost-cutting measures increased its confidence that the company can reach the upper end of its 2014 Ebit target of as much as 20 million euros.
LPKF Laser & Electronics AG jumped 7.9 percent to 19.55 euros, after getting an order of more than 15 million euros for solar-module equipment.
RWE declined 0.9 percent to 26.81 euros. Germany’s second-largest utility expects to write down an additional 3.3 billion euros when it reports 2013 earnings following a slump in profit from power plants. About 2.9 billion euros of the amount is attributable to the “continued deterioration” of earnings from fossil-fueled power stations, the Essen-based company said.
Jenoptik AG retreated 2.2 percent to 12 euros. The supplier of optical systems forecast earnings before interest and taxes of no more than 62 million euros in 2014, falling short of the median analyst estimate of 63.75 million euros, according to a Bloomberg survey.