German Stocks Extend Weekly Advance as Henkel, Infineon Climb

By Julie Cruz

Oct. 16 (Bloomberg) -- German stocks advanced, extending the second straight week of gains, as Nomura Holdings Inc. recommended Henkel AG and higher-than-estimated earnings from Google Inc. added to signs the global economy is recovering.

Henkel climbed 2.6 percent after Nomura upgraded the shares to “buy” from “neutral.” Infineon Technologies AG, Europe’s second-largest semiconductor maker, and E.ON AG, the country’s biggest utility, rose at least 1.4 percent.

The benchmark DAX Index added 0.9 percent to 5,881.49 as of 9:49 a.m. in Frankfurt, for a weekly gain of 3 percent. The measure has rallied 60 percent since March 6 as companies reported better-than-estimated earnings and economic data signaled the global recession is nearing an end. The broader HDAX Index increased 0.9 percent today.

Google said net income rose 27 percent to $1.64 billion. Excluding revenue passed on to partner sites, sales were $4.38 billion, compared with an estimate of $4.25 billion in a Bloomberg survey of analysts.

Industrial production in the U.S. probably climbed in September for a third consecutive month, putting manufacturing at the forefront of the emerging economic recovery, economists said before a report today.

Henkel, the German maker of Loctite glues and Persil detergent, rallied 2.6 percent to 32.54 euros, on course for the highest close since January 2008. Nomura said in a report “the market in our view continues to underestimate the magnitude of cost-saving potential at Henkel.”

Recommendations

Infineon climbed 1.9 percent to 3.95 euros, recouping some of yesterday’s 3.7 percent drop.

E.ON advanced 1.4 percent to 26.95 euros. The company was rated “hold” in new coverage at Commerzbank AG, which set its share-price estimate at 30 euros.

GEA Group AG rallied 3.1 percent to 14.90 euros after Equinet AG lifted its recommendation on the stock to “buy” from “accumulate.”

“GEA has demonstrated above average resilience (lower decline in orders coupled with profitability) and is heavily exposed to attractive end-markets such as food & beverage as well as energy,” Frankfurt-based analyst Holger Schmidt wrote in a report to clients.

IVG Immobilien AG surged 4.5 percent to 7.96 euros as the company said it sold a number of properties in recent weeks worth a total of 470 million euros ($700 million).

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