Farming drives Germany's Bayer earnings

Bayer's quarterly core profit rose 5 percent on Wednesday as strong sales of its weed and fungus killers and cancer drugs more than offset weaker plastics earnings hit by rising raw material and energy costs.

Thanks to robust demand for agrochemical products, Bayer doubled its sales growth expectations for the business, leading to a slight sales upgrade for the group, whose market capitalisation is $68 billion.

"The successful first half of 2008 has strengthened our confidence for the full year," Bayer Chief Executive Werner Wenning said in a statement.

Bayer shares fell 1.8 percent to 54.72 euros at 0746 GMT, compared with a 1 percent increase in the German blue-chip DAX index.

Jochen Schlachter, a credit analyst at Unicredit, said he kept his overweight recommendation for Bayer's senior bonds after the results as he expected continued positive operating performance and a steadily improving credit profile.