German Stocks Snap Three-Day Advance; Banks, RWE, BASF Decline

By Julie Cruz

April 15 (Bloomberg) -- German stocks fell for the first time in four days, led by banks, as Switzerland’s UBS AG reported a first-quarter loss and said it will cut more jobs.

Commerzbank AG and Deutsche Bank AG, Germany’s biggest, dropped more than 2 percent each. RWE AG snapped a five-day gain as Goldman Sachs Group Inc. recommended selling the shares. BASF SE, the world’s largest chemical company, retreated 2.4 percent.

The benchmark DAX Index fell 0.6 percent to 4,531.96 as of 12:19 p.m. in Frankfurt. The measure has rebounded 24 percent from this year’s lows, trimming the decline in 2009 to 5.7 percent, as banks from Barclays Plc to Citigroup Inc. fueled speculation the worst of the credit crisis is over. The HDAX Index of the country’s 110 largest companies slipped 0.4 percent to 2,254.44 today.

“There are signs of hope, but the reality is still gloomy,” said Markus Steinbeis, head of equity portfolio management at Pioneer Investments Kapitalanlagegesellschaft mbH in Unterfoehring near Munich. “It’s quite tough to forecast the quality of the balance sheets of the banks. At this stage, there is hope things will get better in the second half of the year.”

Commerzbank fell 2 percent to 4.92 euros, ending two days of gains. Deutsche Bank lost 3.5 percent to 37.35 euros. Allianz SE slipped 1.1 percent to 70.70 euros.

UBS said it will cut an additional 7,500 jobs after reporting a loss and outflows of client funds in the first quarter. The bank will reduce the number of employees to 67,500 in 2010, compared with a previous target of 75,000, UBS said today. It reported a net loss of “almost” 2 billion Swiss francs ($1.75 billion) for the first quarter.

RWE, BASF

RWE retreated 1.2 percent to 56.19 euros. Germany’s second- largest utility was downgraded to “sell” from “neutral” at Goldman Sachs, which “forecast a dividend cut in 2009 followed by a further cut in 2013.”

BASF lost 2.4 percent to 27.06 euros. The company said it’s preparing for short-time work at its Ludwigshafen site, with short time being introduced in production units as of June.

The following stocks also rose or fell in German markets. Symbols are in parentheses.

Didier-Werke AG (DID GR) added 1.8 percent to 97.80 euros. The German fireproofing-materials maker owned by Austria’s RHI AG said full-year net income rose to 38 million euros ($50.3 million) from 18.2 million euros, as sales increased.

Heidelberger Druckmaschinen AG (HDD GY) fell 3.2 percent to 4.81 euros, ending two days of gains. The world’s largest maker of printing presses was downgraded to “hold” from “buy” at Equinet AG, saying the brokerage’s share-price estimate has been reached.

TUI AG (TUI1 GY) climbed 4.3 percent to 5.94 euros, the highest intraday price in two months. The German owner of Europe’s largest travel company agreed to form a joint venture with Russian billionaire Alexei Mordashov’s tourism assets to expand in the former Soviet Union.

To contact the reporter on this story: Julie Cruz in London at Jcruz6@bloomberg.net.