German Stocks Retreat; Deutsche Bank, Commerzbank, BMW Drop

By Adria Cimino

Nov. 3 (Bloomberg) -- German stocks fell, led by banks after UBS AG, Switzerland’s biggest, reported a wider-than- estimated loss. Bayerische Motoren Werke AG declined after reporting a drop in third-quarter profit.

Deutsche Bank AG and Commerzbank AG both slipped more than 2 percent. BMW, the world’s largest maker of luxury cars, fell 5.2 percent.

The DAX Index slid 1.2 percent to 5,365.2 at 10:07 a.m. in Frankfurt. The gauge tumbled 5.7 percent last week amid concern the European Union may impose restrictions on financial companies in return for state aid and speculation a near eight- month rally has outpaced economic growth prospects. The broader HDAX Index also lost 1.2 percent today.

European bank shares fell after UBS reported its fourth consecutive quarterly loss.

The UBS report “isn’t a very favorable signal,” said Arnaud Scarpaci, a fund manager at Agilis Gestion in Paris, which oversees about $147 million. “We can expect two or three difficult weeks for bank stocks.”

Deutsche Bank, Germany’s biggest, slid 2.1 percent to 48.45 euros. Commerzbank, the second largest, retreated 2.4 percent to 7.02 euros. The bank yesterday reported a third-quarter net loss because of costs tied to the integration of Dresdner Bank and writedowns stemming from its Eurohypo commercial-property unit.

BMW sank 5.2 percent to 31.88 euros. The carmaker reported a 74 percent plunge in third-quarter profit to 78 million euros ($115 million) as the recession sapped demand for higher-priced models.

The following shares rose or fell in Frankfurt. Stock symbols are in parentheses.

Escada AG (ESC GY) tumbled 8.6 percent to 53 cents, falling for a second day. Escada’s insolvency administrator Christian Gerloff will decide on a sale of the fashion company by the middle of the week, Sueddeutsche Zeitung said, without being more specific. Four bids have been submitted for Escada, the German newspaper reported, without saying where it got the information.

Fresenius SE (FRE3 GY) climbed 2.4 percent to 40.26 euros, for the biggest gain in three weeks. The world’s biggest provider of kidney dialysis reported an increase in third- quarter profit adjusted to reflect mark-to-market accounting for exchangeable bonds and the acquisition of APP Pharmaceuticals to 128 million euros from 112 million euros.

Metro AG (MEO GY) added 2.5 percent to 38.42 euros for the biggest gain in almost a month. Germany’s largest retailer said savings from the “Shape 2012” cost-reduction program were 70 million euros in the third quarter.

To contact the reporter on this story: Adria Cimino in Paris at acimino1@bloomberg.net.