German stocks suffer biggest quarterly drop since 2002

German stocks fell, extending the benchmark DAX Index's biggest quarterly drop in nine years, as concern deepened that Europe's debt crisis will hurt growth and choke off funding for banks. Deutsche Bank AG and Commerzbank AG slid following speculation that banks in Belgium and Austria may need more government support. Carmakers BMW and Daimler AG declined as investors speculated that China's economy is slowing more than expected. The DAX dropped 2.2 per cent to 5,380.09 at 12:43pm. in Frankfurt, having earlier fallen as much as 3.9 per cent. The gauge slumped 25 per cent last quarter, its largest plunge since 2002, amid concern global growth is stumbling as policymakers struggle to contain Europe's sovereign-debt crisis. The DAX has fallen 22 per cent this year. The broader HDAX Index lost 2.2 per cent yesterday. "Clearly this ongoing negative news about the European crisis is doing nothing for sentiment," said David Jones, chief market strategist at IG Index in London. Deutsche Bank, Germany's biggest bank, fell 2.7 per cent to €25.61. Commerzbank tumbled 6.1 per cent to €1.78.