DAX Poised for Highest Close Since October; BASF, MAN Climb

By Julie Cruz

Aug. 24 (Bloomberg) -- German stocks advanced as leaders of the world’s biggest central banks buttressed confidence in the global economic recovery and European industrial orders rose more than economists forecast in June.

BASF SE rose to its highest level in almost a year after its chief executive officer said a takeover of the company may be possible. ThyssenKrupp AG and Salzgitter AG, Germany’s biggest steelmakers, also advanced. MAN SE climbed for a third day, adding 4.5 percent.

The benchmark DAX Index added 0.7 percent to 5,500.62 as of 11:39 a.m. in Frankfurt, on course for the highest close since October, after trading started with a delay today due to a technical problem at the exchange. The broader HDAX Index gained 0.8 percent.

Germany’s benchmark index has rallied 50 percent since March 6 as companies worldwide from Goldman Sachs Group Inc. to Bayer AG reported better-than-projected earnings and economic data signaled improvement.

“We continue to see positive surprises in the economic data,” wrote Tammo Greetfeld, senior equity strategist at UniCredit Markets & Investment Banking in Munich, in a note to clients today. “A sudden sharp deterioration of the stock market environment in 2009 is very unlikely.”

Federal Reserve Chairman Ben S. Bernanke and European Central Bank President Jean-Claude Trichet, speaking at the annual central bankers’ symposium in Jackson Hole, Wyoming, said the world economy is pulling out of recession. The Commerce Department on Aug. 26 may report that purchases of new U.S. houses rose 1.6 percent in July to 390,000, the highest level since November, a Bloomberg survey of economists showed.

Oil Prices

ThyssenKrupp and Salzgitter increased 1 percent to 24.73 euros and 1.5 percent to 69.30 euros, respectively. Oil traded near a 10-month high and metal prices rose in London.

BASF SE, the world’s biggest chemical company, added 2.2 percent to 36.98 euros. Chief Executive Officer Juergen Hambrecht said the company may become the target of a hostile takeover. “Of course, an attack is possible,” German weekly Wirtschaftswoche quoted him as saying in an interview. It would take 70 billion euros ($100 billion) for a hostile bid to succeed, he said, adding that this sum would be difficult to raise.

Separately, BASF said it is increasing the price for carbonates worldwide.

MAN SE, Europe’s third-largest truckmaker, jumped 4.5 percent to 52.63 euros, on course for the highest close in more than 11 months.

Siemens AG increased 1.2 percent to 59.83 euros. Europe’s largest engineering company and Germany’s state-owned railway Deutsche Bahn AG may jointly pursue orders for U.S. high-speed trains, Der Spiegel reported, without saying where it obtained the information.

Deutsche Bank

Orders to industrial companies in the euro region rose 3.1 percent from May to June, the biggest gain in 19 months, the European Union’s statistics office in Luxembourg said today. Economists forecast a 1.8 percent rise, according to the median of 20 estimates in a Bloomberg survey. From a year earlier, June orders fell 25.1 percent, less than economists had projected.

Deutsche Bank AG added 1.5 percent to 48.82 euros. Smaller competitor Commerzbank AG also gained 1.5 percent.

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

Arcandor AG (ARO GY) slumped 16 percent to 26 cents. The insolvent retailer was cut to “sell” from “underperform” at Credit Agricole-Cheuvreux SA.

Separately, Madeleine Schickedanz, the retailer’s major shareholder, and Sal. Oppenheim Jr. & Cie. probably won’t receive anything in the company’s insolvency plan, Handelsblatt reported, citing Rolf Weidmann, a partner at the law firm overseeing the proceedings.

IKB Deutsche Industriebank AG (IKB GY) rose 1.7 percent to 60 cents. The bank reported first-quarter net income of 19.4 million euros, compared with a loss of 517.1 million euros a year earlier.

Pfleiderer AG (PFD4 GY) sank 6.5 percent to 6.29 euros, a second straight decline. The laminate-flooring maker posted a second-quarter loss per share of 6 cents compared with a breakeven as sales slid 26 percent to 334.5 million euros.

Porsche SE (PAH3 GY) lost 4.5 percent to 50.40 euros. The sports-car maker’s former chief executive officer, Wendelin Wiedeking, and ex-Chief Financial Officer Holger Haerter had their homes searched during the raid by German prosecutors, a spokeswoman for the Stuttgart-based prosecutor’s office said.

To contact the reporter on this story: Julie Cruz in Frankfurt at jcruz6@bloomberg.net.