German shares lower in afternoon trading as Wall Street opens flat

German shares lower in afternoon trading as Wall Street opens flat

	Published : Fri, 26 Jan 2007 16:38 By : Agencies Print this Story

FRANKFURT (AFX) - German shares were down in afternoon trade as Wall Street opened flat.

At 4.04 pm, the DAX was down 35.98 points or 0.54 pct to 6,655.21, while it traded between 6,659.45 and 6,731.36 this morning.

The MDAX was 62.64 points lower or 0.64 pct to 9,655.21 and the TecDax was down 2.34 points or 0.29 pct to 802.11.

DAX futures gained, adding 9.50 points or 0.14 pct to 6,717.00 and Bund futures were down 0.13 points or 0.11 pct at 114.87.

The euro was trading at 1.29013 usd against 1.29085 yesterday.

Deutsche Boerse retreated to the low end of the DAX after NYSE CEO John Thain said he is interested in cooperation between NYSE and Tokyo Stock Exchange, dealers said.

Shares declined by 3.29 eur or 2.02 pct to 159.81.

One Frankfurt-based trader said the market was hoping the German exchange might cooperate with Tokyo. The move by NYSE is pushing Deutsche Boerse out of the consolidation movement in the sector, dealers said.

In addition, traders were talking about profit-taking as the stock has risen to record highs since the beginning of the year.

Siemens dropped to 81.51, down 1.06 eur or 1.28 pct as the stock going ex-dividend outweighed target-price rises at Citigroup, JP Morgan and West LB, dealers said.

Citigroup raised its price to 95 eur from 85, with West LB increasing its price to 97 eur from 92 and JP Morgan adding 5 eur to the target price, bringing it to 89 eur from 84.

Deutsche Telekom lost 0.18 eur or 1.26 pct to 14.14 followed by Allianz which slipped 1.60 eur or 1.06 pct to 148.77.

Amongst gainers, Metro impressed, adding 1.19 eur or 2.28 pct to 53.39 as a report in food industry trade publication Lebensmitttel Zeitung stated that there is speculation in the market of a break-up of the company, dealers said.

The report added that rumours are emerging that Metro is scaling down its real estate portfolio to improve its position in the case of a takeover attempt by Haniel, one of the company's largest shareholders.

Commerzbank gained momentum, climbing 0.10 eur or 0.31 pct to 32.68 amid rumours that Merrill Lynch was planning a takeover, dealers said.

Dealers however said it was a typical Friday rumour.

Lufthansa climbed 0.36 eur or 1.73 pct to 21.12.

Dealers said the stock was recovering from its weak performance in the past few weeks.

Citigroup reiterated its 'buy' recommendation and 25 eur target price and added that it was confident the company can reach its operating profit target of 1 bln eur in 2007 - one year ahead of the company's own estimate.

One Frankfurt-based trader added that next week's strikes at British Airways are helping the shares in the short-run.

Henkel also gained, up 0.83 eur or 0.71 pct to 118.02 as JP Morgan increased its target price to 105 eur from 95 in a sector revaluation.

The broker reiterated its 'underweight' recommendation and added that it believes the valuation is not 'fully stretched', which is one of the reasons for the target price increase, but thinks the stock needs signs of earnings upgrades to maintain momentum.

Porsche was another major mover, jumping as the company released its full-year 2006 figures but the shares slipped 13.58 eur or 1.34 pct in afternoon trade to 996.42 as it said it is not planning to raise its stake in automaker Volkswagen AG to more than 29.9 pct.

On the MDAX, Heidelberger Druckmaschinen went to the bottom of the index, down 0.83 eur or 2.39 pct to 33.84. MTU Aero Engines was top of the leaders board, adding 1.45 eur or 3.83 pct to 39.30 as UBS raised the target price to 45 eur from 38 and reiterated it 'buy' rating.

On the TecDax, Conergy was weak, down 1.77 eur or 3.74 pct to 45.50 with Draegerwerk adding 1.31 eur or 2.25 pct to 59.57.

patrizia.kokot@thomson.com

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