DAX Rises 1.2% as Stocks Surge on U.S.-Iran Peace Deal

Dax Futures

German stocks experienced an upward movement on Monday, as investors reacted positively to the announcement that Iran and the U.S. have reached an agreement to conclude the Middle East conflict. Oil prices experienced a significant decline, alleviating worries regarding inflation and interest rates. The preliminary framework of the deal encompasses the cessation of the U.S. blockade on Iran and the reopening of the Strait of Hormuz. The significant decline in oil prices has contributed to alleviating inflation worries, enhancing the positive sentiment in the markets. Reports indicate that an official signing ceremony is set to occur in Switzerland on June 19.

US President Donald Trump announced the agreement on Truth Social on Sunday, stating, ‘The Deal with the Islamic Republic of Iran is now complete.’ ‘Let the oil flow!’ the U.S. President exclaimed, asserting that the ‘great deal’ would usher in ‘peace and security to the whole region.’ Brent crude futures decreased to $82.52 a barrel, reflecting a decline of approximately 5.5%. The German market’s benchmark DAX, which climbed to 25,088.82 earlier, was up 295.04 points or 1.2% at 24,907.60 a little while ago.

  • Automobile stocks BMW, Mercedes-Benz, and Daimler Truck Holding experienced increases of 3.1%, 2.7%, and 2.6%, respectively. Volkswagen experienced an increase of 2.5%, while Porsche Automobil Holding saw a rise of 2.35%.
  • MTU Aero Engines experienced an increase of nearly 6%. Heidelberg Materials experienced an increase of 3.5%, while Deutsche Bank saw a rise of 3%. Vonovia, SAP, Continental, Siemens, and Fresenius experienced increases ranging from 2.2% to 2.7%.
  • Scout24, Munich RE, Symrise, Allianz, Beiersdorf, Deutsche Post, Siemens Energy, and Zalando also recorded significant increases.
  • Bayer experienced an approximate 1% increase following the FDA’s approval of the company’s low-dose Gadoquatrane in the United States. However, the stock reduced its gains later and fell into negative territory, declining by approximately 0.2%.
  • Rheinmetall experienced a decline of 2.25%. Meanwhile, RWE, Brenntag, Commerzbank, Deutsche Boerse, Infineon Technologies, Deutsche Telekom, and BASF saw decreases ranging from 0.8% to 1.7%.

Germany’s wholesale price inflation moderated in May, primarily attributed to the decrease in the energy tax on mineral oil products, according to data released by Destatis on Monday. Wholesale prices experienced a year-on-year increase of 5.9% in May, following a rise of 6.3% in April. In economic news, Destatis reported that the conflict in the Middle East has led to an increase in wholesale prices for energy products and raw materials, specifically. Prices of mineral oil products have experienced a significant increase of 30.5% compared to the previous year.

However, prices experienced a decline of 7.3% from April, attributed to the lowered energy tax rate. Additionally, the wholesale sector for non-ferrous ores, non-ferrous metals, and non-ferrous semi-finished metal products experienced a notable increase of 36.1% in May. In May, wholesale prices experienced a decline of 0.6% on a monthly basis, representing the first decrease in five months. This negated the 2% increase observed in April.