Rising oil price takes toll on Frankfurt index

Eurostoxx 50:2983.27 (-29.82) Frankfurt DAX:7,223.3 (-49.02 ) Paris CAC: 4,067.15 (-43.20)

GERMAN STOCKS retreated for the first time in three days amid speculation rising energy costs will threaten the economic recovery as concern about political turmoil in the Middle East pushed up the price of oil.

Deutsche Lufthansa and Air Berlin, Germany’s biggest airlines, declined amid concern fuel costs will increase.

E.ON and RWE, the nation’s largest utilities, dropped more than 1 per cent.

Aixtron surged 3.6 per cent after proposing to raise its dividend.

The DAX slid 0.7 per cent having risen as much as 1.2 per cent early on. The measure dropped 3.3 per cent last week as opponents of Libyan leader Muammar Gadafy seized control of large parts of the country. Even so, the German gauge increased 2.8 per cent last month and is up 4.5 per cent this year amid optimism that the global economic recovery is gathering strength.

German stocks retreated even as the European Commission raised its economic-growth forecast for 2011 and reports showed US and European manufacturing expanded.

Travel-industry shares posted the second-worst performances among 19 industry groups in the Stoxx Europe 600 Index.

France’s CAC index declined 1.1 per cent as Groupe Steria slid 1.3 per cent. The computer-services company said full-year net income declined 11 per cent as it re-evaluated pension commitments and covered the costs of rationalisation.

Maurel Prom jumped 4 per cent. The French oil producer with a market value of about €1.58 billion is weighing a sale, said three people with direct knowledge of the matter. The company is working with banks including Citigroup to explore options and has drawn interest from potential bidders.

Remy Cointreau gained 2.7 per cent. The distributor of wines and spirits said it had entered talks to sell its Champagne division to EPI, the owner of French retail brands including Bonpoint. The stock was raised to “add” from “reduce” at Gilbert Dupont.

Technicolor lost 5.7 per cent. The company posted a full-year net loss of €69 million compared with a loss of €342 million a year earlier, the company said. – (Bloomberg)