By Cornelius Rahn
Dec. 7 (Bloomberg) -- German stocks dropped as steelmakers declined with metal prices and Morgan Stanley downgraded shares of Siemens AG.
The benchmark DAX Index slid 1 percent to 5,757.85 as of 9:43 a.m. in Frankfurt, erasing a 0.8 percent gain on Dec. 4. A nine-month rally has left the measure valued at about 62 times its companies’ reported earnings, near the highest level since 2002, according to weekly data compiled by Bloomberg. The broader HDAX Index also fell 1 percent today.
ThyssenKrupp AG and Salzgitter AG, Germany’s biggest steelmakers, dropped 1.5 percent to 24.94 euros and 1.3 percent to 63.93 euros, respectively. Basic-resources companies were the worst performers among 19 industry groups in the pan-European Dow Jones Stoxx 600 Index today, falling as much as 1.7 percent.
Siemens slid 2.1 percent to 62.18 euros, the lowest in a month based on closing prices. Europe’s biggest engineering company was downgraded to “equal-weight” from “over-weight” at Morgan Stanley, which said in a report to clients that “losses in non-core operations are likely to continue to weigh on reported earnings and cash flow.”
Bayer AG fell 1.6 percent to 52.85 euros, snapping four days of gains. Germany’s biggest drugmaker and its partner, Johnson & Johnson, have decided to postpone their response on the rivaroxaban anti-clotting agent to the U.S. Food and Drug Administration, which is part of the application process for the treatment.
A report today may show German factory orders climbed for an eighth month in October, according to a Bloomberg News survey of economists. The figures are scheduled for 12 p.m. local time.
The following shares rose or fell in German markets. Stock symbols are in parentheses.
Arcandor AG (ARO GY) jumped 31 percent to 22 cents, the biggest increase in a month. None of the company’s remaining 120 Karstadt department stores will be closed next year, as the unit has returned to profit and two dozen prospective buyers have expressed interest, Bild am Sonntag cited insolvency official Rolf Weidmann as saying.
SMA Solar Technology AG (S92 GY) surged 4.1 percent to 96.35 euros, a third straight increase. The German maker of solar-power equipment has its share-price estimate raised to 110 euros from 82 euros at Citigroup Inc.
To contact the reporter on this story: Cornelius Rahn in Frankfurt at crahn2@bloomberg.net
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