German Stocks Rise for Second Day; RWE, Allianz AdvanceTrista Kelley
German stocks rose for a second day as investors weighed Crimea’s vote to leave Ukraine and join Russia, while RWE AG and Allianz SE climbed amid mergers-and-acquisitions activity.
Allianz gained the most in two months after agreeing to buy Milano Assicurazioni SpA assets from Unipol Gruppo Finanziario SpA for 440 million euros ($612 million). RWE added 1.3 percent after agreeing to sell its Dea oil-and-gas unit to L1 Energy for about 5.1 billion euros. Linde AG declined the most since October as the world’s largest industrial-gas producer posted profit that missed analyst estimates.
The DAX Index advanced 1.4 percent to 9,180.89 at the close of trading in Frankfurt. The benchmark gauge fell 3.2 percent last week, for a second week of losses, amid concerns that Russian military intervention in Ukraine could lead to sanctions and trade disruptions. The HDAX Index rose 1.5 percent today.
“Crimea is the focus for investors right now,” Michael Kapler, an equities portfolio manager at Mittelbrandenburgische Sparkasse said by phone from Potsdam, Germany. “We had quite a heavy down move last week because in most cases when you have these kind of decisions over the weekend people try to go into safety first and put off any risk; if nothing bigger happens then faults will be covered. It’s still a quite fluid situation and the picture isn’t clear, so we could see more volatility going forward.”
Almost 97 percent of voters in the Black Sea peninsula of Crimea chose to leave Ukraine and become part of Russia, according to Mikhail Malyshev, head of the election commission. The results exclude the city of Sevastopol.
The European Union called the referendum illegal and said it won’t recognize the outcome. The U.S. and EU imposed sanctions on Russia after the vote paved the way for Putin to annex Crimea.
EU foreign ministers agreed today to freeze assets and impose visa travel bans on 21 Russians, Crimeans and former Ukrainian officials. U.S. measures were aimed at the wealth of Russia’s supporters, the White House said in a statement.
Germany has the most at stake in Ukraine among western European countries, according to data compiled by Bloomberg. Trade between the two countries totaled $8.38 billion in 2012. Germany is Russia’s biggest trading partner after China, the data show.
Allianz climbed 2 percent 122.90 euros. Europe’s biggest insurer will buy the Italian assets in a deal that includes a 1.1 billion-euro premiums portfolio, 729 agencies and 500 employees, Allianz said in March 15 statement.
RWE added 1.3 percent to 28.84 euros. The deal gives L1 Energy, the investment vehicle of Russia’s fourth-richest man, Mikhail Fridman, assets in the U.K., Germany and the North Sea. The sale values Dea at about 5.1 billion euros, including debt, Germany’s largest power generator said in a statement yesterday.
Siemens AG added 3.4 percent to 93.69 euros. JPMorgan Chase & Co. raised its rating on Europe’s largest engineering company to overweight, similar to buy, from neutral, saying that the 4 billion-euro share buyback announced in November could start soon. Bank of America Corp. upgraded the shares to buy from neutral, citing the benefits of cost and portfolio restructuring.
Infineon Technologies AG rose 3.4 percent to 8.19 euros. Europe’s second-biggest chipmaker may buy back shares, Handelsblatt newspaper reported, citing an interview with Chief Executive Officer Reinhard Ploss.
Porsche Automobil Holding SE added 1.3 percent to 73.18 euros. Judges in Stuttgart dismissed a lawsuit seeking 1.4 billion euros over the German carmaker’s aborted takeover of Volkswagen AG.
The lawsuit was filed by 23 hedge funds including Viking Global Equities LP, Glenhill Capital LP and David Einhorn’s Greenlight Capital Inc., who claim that Porsche misled them over intentions to bid for VW more than five years ago.
Linde declined 2.6 percent to 139.90 euros. Earnings before interest, taxes, depreciation and amortization fell 3.6 percent to 970 million euros in the fourth quarter, missing the 992.3 million euro average projection by analysts surveyed by Bloomberg.