German Stocks Experience the Biggest Rise in 4 Years

A possible agreement on the budget deal and the surge of the factory orders in the biggest economy of Europe, Germany, in October, helped the country to experience a rally in the stock prices. The stock prices have gone to the highest level since January, 2008 as The DAX Index has increased by 1.1% to finish at 7534.54. The HDAX Index has also jumped up by 1.2%. Germany’s equity benchmark has also surged by 26%, thanks to the approval of the bond buying program by European Central Bank and easing the terms of Greece bailout loans. The shares that changed hands were 9.5% more than the average for the last 1 month. However, Soeren Steinert, the associate director for Quoniam Asset Management GmbH stated that the volumes are not huge and hence, the current market move is probably not being supported by a broad mass. 

The factory orders of Germany saw a jump of about 4 times in October than the predicted pace by economists. Orders, after being adjusted for inflation and seasonal swings increased by 3.9% from the month of September, as declared by the Economy Ministry.

Coming to individual stocks, the largest drug maker of Germany, Bayer AG saw an increase of 3.4% after asking for permission to use a new medicine (Eylea) to treat an eye condition named macular edema degeneration. The maker of famous Nivea skin cream, Beiersdorf AG also gained 2% as the 2012 sales forecast for the company increased for the 2nd time in the last couple of months. The initial sales rise was predicted to be 3% and was changed to somewhere between 3% and 4% on 2nd November. However, the latest figures suggest that the company will increase its sales by more than 4% in 2012.

The largest steelmaker of Germany, ThyssenKrupp AG surged by 2.3%, whereas, its biggest competitor, Salzgitter AG added another 1.7%. The largest independent steel trader of Europe, Salzgitter AG saw an increase of 6.1% in its share prices. The 3rd biggest luxury vehicles maker in the world, Daimler AG also surged by 1.2% as it sold 7.5% of its stake in Defence & Space Co. It will sell the remaining 7.5% stake after 180 more days. RWE AG was however an exception as its share prices plummeted by 1.4%, followed by a disappointing 2013 earnings forecast.