German stocks rose for the first time in six days amid speculation that Federal Reserve Chairman Ben S. Bernanke will take steps to bolster the U.S. recovery.
MAN SE (MAN), Europe’s third-largest truckmaker, rallied 3.2 percent. Bayerische Motoren Werke AG (BMW) and Daimler AG (DAI), the world’s biggest makers of luxury cars, rose at least 3 percent. Wacker Chemie AG (WCH), the second-largest producer of solar-grade silicon, jumped 5.5 percent.
The DAX advanced 84.56, or 1.5 percent, to 5,558.34 at 12:07 p.m. in Frankfurt. The gauge dropped 8.6 percent last week as concern escalated that the global economy is slowing and as the leaders of the euro area failed to restore investor confidence. The broader HDAX Index (HDAX) also rose 1.5 percent today.
“Everybody wants to know what the Fed is going to do,” said Markus Wallner, a senior equity strategist at Commerzbank AG in Frankfurt. “Investors are eager to hear whether the Fed will make any hints regarding a third round of quantitative easing, which would inspire the markets. However, it should still remain a volatile week.”
The DAX traded at 8.5 times the estimated earnings of its constituent companies, near the cheapest valuation since October 2008, according to Bloomberg data.
Central bankers will meet on Aug. 26 at an annual conference sponsored by the Fed Bank of Kansas City. Bernanke said at last year’s meeting the Fed was prepared to “do all that it can” to ensure economic recovery and suggested that it would purchase more securities if growth slowed.
German Investor Confidence
German investor confidence fell in August more than economists had forecast to its lowest in more than 2 1/2 years. The ZEW Center for European Economic Research in Mannheim said its index of investor and analyst expectations, which aims to predict developments six months in advance, dropped to minus 37.6 from minus 15.1 in July. That’s the lowest since December 2008. Economists had predicted a decline to minus 26, according to the median of 36 estimates in a Bloomberg News survey.
A separate report showed that a manufacturing purchasing managers’ index for Germany, Europe’s largest economy, unexpectedly held at 52 in August. Economists had projected a drop to 50.6, according to the median forecast in a Bloomberg News survey. A reading above 50 signals expansion.
A U.S. report at 10 a.m. in Washington will show new home sales fell 0.6 percent in July, according to the median estimate of economists surveyed by Bloomberg. Sales slid 1 percent in June. A separate survey may show the Richmond Fed’s index of manufacturing declined for a second month.
MAN, BMW, Daimler
MAN rallied 3.2 percent to 59.77 euros. Volkswagen AG (VOW) said it submitted a merger control filing for MAN to the European Commission. The carmaker said it expects to receive regulatory approval in the second half of the year. Volkswagen jumped 2.6 percent to 104.45 euros.
BMW climbed 3.8 percent to 51.97 euros after WestLB AG raised the company’s shares to “add” from “neutral.”
Daimler gained 3 percent to 34.98 euros as a gauge of European carmakers was the best performer of the 19 industry groups in the benchmark Stoxx Europe 600 Index.
Wacker Chemie surged 5.5 percent to 97.38 euros and Manz AG, the maker of machinery for the solar-panel industry, soared 7.3 percent to 23.48 euros after Goldman Sachs Group Inc. analysts including Stephen Benson raised the stocks to “buy” from “neutral.” They also upgraded Centrotherm Photovoltaics AG (CTN), the maker of solar production equipment, to “buy” from “sell.” Centrotherm’s shares rallied 6.2 percent to 23.22 euros.
Bayer AG (BAYN) rose 3.1 percent to 44.75 euros after the Leverkusen-based chemical maker said the U.S. Food and Drug Administration granted fast-track designation to the Alpharadin drug that the company has developed with Algeta ASA to treat castration-resistant prostate cancer.
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