German stocks advanced for a fourth day amid optimism the European Central Bank will win support from policy makers to ease the euro area’s debt crisis. Deutsche Bank AG (DBK) and Commerzbank (CBK) AG climbed more than 2.5 percent each after Financial Times reported that German banks have cut back lending to weaker euro-area nations. Siemens AG (SIE) rose 2.1 percent after a report said ThyssenKrupp AG will not merge with the company. The DAX Index (DAX) gained 0.9 percent to 6,751.05 at 2:02 p.m. in Frankfurt. The measure has increased percent 13 percent from its 2012 low on June 5 as euro-area leaders eased repayment terms for Spanish lenders and central banks took measures to support growth. The broader HDAX Index added 0.8 percent today. “This time the markets think the ECB might implement the measures they have been talking about, co-ordinated action between the ECB and euro-bailout mechanisms,� said Ion-Marc Valahu, co-founder and fund manager at Clairinvest in Geneva. “We have an optimistic rally going into Thursday’s ECB meeting, which will be critical.� ECB President Mario Draghi, who sparked a global market rally last week by pledging to do whatever it takes to preserve the euro, is trying to build consensus among governments and central bankers for a plan to ease borrowing costs in Spain and Italy before ECB policy makers convene on Aug. 2. Draghi meets U.S. Treasury Secretary Timothy Geithner in Frankfurt today and will also seek the support of Bundesbank President Jens Weidmann, a critic of ECB bond purchases. Siemens, ThyssenKrupp Deutsche Bank and Commerzbank, Germany’s two biggest lenders, climbed 3.4 percent to 25.19 euros and 2.8 percent to 1.27 euros respectively. Cross-border lending by German banks to the weaker parts of the euro area has dropped by nearly a fifth since January and stands at the lowest level since 2005, the Financial Times reported citing Morgan Stanley’s analysis of Bundesbank data. Deutsche Lufthansa AG (LHA) rose 2.4 percent to 10.33 euros. Air France-KLM Group halved its second-quarter loss, beating analyst estimates, as a 2 billion-euro ($2.5 billion) savings program at Europe’s biggest airline began to bring down costs. Siemens, Europe’s largest engineering company, gained 2.1 percent to 68.30 euros, for the biggest contribution to the increase in the DAX Index. ThyssenKrupp won’t merge with Siemens, Sueddeutsche Zeitung cited Gerhard Cromme, the chairman of both companies, as saying. German media, including the WirtschaftsWoche magazine, had reported that ThyssenKrupp, Germany’s largest steelmaker, may seek a merger with Siemens in the long term as the German steel manufacturer may not be able to survive on its own. To contact the reporter on this story: Jonathan Morgan in Frankfurt at jmorgan157@bloomberg.net To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net

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