German Stocks Rise Before U.S. Housing Report; Daimler Climbs

By Julie Cruz

Nov. 18 (Bloomberg) -- German stocks climbed for a second day this week before a report that may show U.S. housing starts in October rose at the fastest pace in 11 months.

The benchmark DAX Index added 0.4 percent to 5,801.42 as of 9:26 a.m. in Frankfurt, recouping most of yesterday’s drop. The measure has rallied more than 50 percent since March 6 as companies posted better-than-estimated earnings and investors speculated the global recession is easing. The broader HDAX Index also gained 0.4 percent today.

Housing starts increased 1.7 percent to an annual rate of 600,000, the most since November 2008, according to the median forecast of 77 economists in a Bloomberg News survey. A report from the Labor Department may show the cost of living climbed 0.2 percent for a second month.

ThyssenKrupp AG, Germany’s largest steelmaker, gained 1.5 percent to 25.16 euros as metal prices rose in London. Smaller competitor Salzgitter AG added 0.9 percent to 65.11 euros.

Bayerische Motoren Werke AG and Daimler AG, the world’s biggest makers of luxury cars, climbed 1.1 percent to 34.26 euros and 1.3 percent to 35.85 euros, respectively. A measure of European automobile and parts companies advanced as much as 1.3 percent today, the best performance among 19 industry groups in Dow Jones Stoxx 600 Index.

Bayer AG declined 2.1 percent to 52.20 euros, ending its longest winning streak since 1999, after International Petroleum Investment Co. denied a report the German drugs and chemicals maker is an acquisition target. IPIC said late yesterday it’s discussing a venture with companies including Bayer to establish a petrochemical plant in Abu Dhabi.

‘Misinterpreted’

IPIC Chairman Khadem Abdulla Al-Qubaisi said he was “misinterpreted” in a report by ICIS news that said IPIC was in talks with five companies including Bayer’s MaterialScience unit and expected to close a European acquisition by the first quarter of next year.

Air Berlin Plc jumped 4.6 percent to 3.66 euros, poised for the biggest advance in a month. The discount carrier said third- quarter net income more than doubled to 95.2 million euros ($141.3 million) and confirmed its forecast for a better operating profit this year than in 2008.

Villeroy & Boch AG rallied 3.5 percent to 5.95 euros after Deutsche Boerse AG said the stock will replace OVB Holding AG, whose free float has fallen below the minimum 10 percent level, in Germany’s SDAX Index of smaller companies. The unscheduled change will take effect Nov. 20, the bourse operator said today.

XING AG increased 3.5 percent to 32.60 euros as the German business networking Web site operator said Burda Digital GmbH has acquired a 25.1 percent stake in the company from Cinco Capital GmbH.

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