Germany39;s DAX drifts further away from record high
Lanxess hits over 3year low after profit warning
Chemicals sector leads declines in Europe
Sanofi says arbitration court rejects Boehringer39;s Zantac claims

June 20 Reuters German stocks led the decline among European peers on Tuesday as shares of speciality chemicals maker Lanxess plunged after lowering its earnings forecast, while a modest interest rate cut by China did little to lift investor sentiment.

Germany39;s DAX index fell 0.3 by 0750 GMT, retreating farther from a record high hit on Friday. The continentwide STOXX 600 index edged 0.1 lower.

Lanxess slid 15.4 to its lowest level in over three years after cutting its secondquarter and annual core profit forecasts, saying it saw no demand recovery in June as customers continued to destock.

The chemicals index slid 1.7, leading sectoral declines.

China cut its key lending benchmarks on Tuesday, with investors worrying that it may be too small to jumpstart a slow economic recovery and awaited a wider stimulus package.

I think the market had got a little carried away with what it was expecting, said Stuart Cole, chief macro economist at Equiti Capital.

The cuts today have matched the 10 bps cut delivered by the People39;s Bank of China last week but the market was looking for a larger reduction.

The Chinaexposed basic resources index dropped 0.6.

Defensive sectors such as utilities and healthcare led the advances on the day.

Sanofi boosted…