German Stocks Decline as Deutsche Bank, Commerzbank Retreat

By Julie Cruz

Sept. 14 (Bloomberg) -- German stocks fell for the first time in seven days, led by lenders, as Joseph Stiglitz said the U.S. has failed to fix the underlying problems of its banking system after the collapse of Lehman Brothers Holdings Inc.

The benchmark DAX Index dropped 1 percent to 5,570.73 as of 9:24 a.m. in Frankfurt, ending the longest winning streak since July. A 52 percent rebound since March 6 left the measure valued at 48 times its companies’ reported earnings, the most expensive level since December 2003, according to weekly Bloomberg data. The broader HDAX slid 1.1 percent today.

“In the U.S. and many other countries, the too-big-to- fail banks have become even bigger,” Stiglitz, the Nobel Prize- winning economist, said in an interview yesterday in Paris. “The problems are worse than they were in 2007 before the crisis.”

Deutsche Bank AG, Germany’s biggest bank, slipped 2.3 percent to 48.62 euros as analysts at Nomura Holdings Inc. lowered its recommendation to “reduce” from “buy.” Commerzbank AG, the second-largest, retreated 3.7 percent to 7.98 euros.

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