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July 28, 2011

Siemens, Volkswagen and BASF see shares fall

Several German industrial giants have seen their share prices fall after reporting disappointing results.

Siemens, Europe's largest engineering conglomerate, reported a drop in third-quarter profits, sending shares down 0.8%.

Chemical firm BASF and carmaker Volkswagen also saw their stocks drop.

The share-price falls helped pushed down the benchmark Dax index of the 30 biggest stocks in Germany. The Dax fell 0.8%, or 56.74 points, to 7,195.94.

Stocks across Europe were lower on fears of the health of the US economy and also concerns over whether the US will reach a political deal to pay its debts.

'Challenging' environment

Siemens said its third-quarter net profit from continuing operations had fallen 47% to 763m euros ($1.11bn, £673m) from the same period a year earlier- below the 1bn euro profit many analysts had expected.

Much of the decline came from the healthcare division, which makes products such as MRI machines and radiation equipment.

"The business environment for healthcare remained challenging," Siemens said.

VW, Europe's biggest carmaker, said its net profit for the first six months of the year rose three-fold to 6.5bn euros.

However, it added that higher commodity prices would "weaken the volume effect" over higher sales for 2011, sending shares down 4.3%.

Meanwhile, BASF shares fell 4.4% after it reported a 22%-increase in second-quarter net profit to 1.45bn euros, but added that high oil prices were weighing on new orders.

"We continue to be concerned about the development of the euro as well as the debt situation in some European countries and the United States," BASF chief executive Kurt Bock said.

Rival Bayer said its second-quarter net income rose 41% to 747m euros and confirmed "the full-year sales and earnings forecast that we raised in April".

However, its revenues of 9.25bn euros fell short of analysts' forecasts, and Bayer's shares fell 1.1%.

Shares in Lufthansa declined 3% after it warned of high oil prices and "competitive pressure in certain markets".

The German airline, which owns the brands Swiss, Austrian and BMI, said its net income rose 55% to 301m euros for the April-to-June period.

Source: BBC
www.bbc.co.uk

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