The Dax surged to its highest level in nearly three weeks on Monday, as investors digested signs of de-escalation in the Middle East.
The German benchmark index rallied on hopes that the temporary halt in US strikes on Iran would stabilize energy markets and reduce geopolitical risk premiums that have weighed on European equities for weeks.
The index had briefly breached 25,809 points on Friday, but Monday’s session was defined by the risk-off reversal linked to the diplomatic and military pause in the region.
The market move followed a sharp pullback in crude oil prices, which retreated from recent highs as the immediate threat of supply disruption in the Strait of Hormuz receded.
This energy price correction provided a tailwind for European industrial and consumer stocks, reversing the selling pressure seen in previous sessions when shipping risks and sanctions fears dominated trading.
This development marks a shift from the record highs the Dax touched earlier in the week, which were driven by rate-cut hopes rather than geopolitical relief.
The index had briefly breached 25,809 points on Friday, but Monday’s session was defined by the risk-off reversal linked to the diplomatic and military pause in the region.