DAX Up 1.2% As Stocks Rally On U.S.-Iran Peace Deal

(RTTNews) - German stocks climbed higher on Monday, with investors cheering the news that Iran and the U.S. have agreed to a deal to end the Middle East war. Oil prices fell sharply, easing concerns about inflation and interest rates.

The preliminary framework of the deal includes halting the U.S. blockade of Iran and reopening of the Strait of Hormuz. The resultant sharp drop in oil prices has helped ease inflation concerns, adding to the upbeat sentiment in the markets.

According to reports, an official signing ceremony is scheduled to take place in Switzerland on June 19.

US President Donald Trump announced the agreement on Truth Social on Sunday, saying, "The Deal with the Islamic Republic of Iran is now complete."

"Let the oil flow!" the U.S. President exclaimed and declared that the "great deal" would bring "peace and security to the whole region."

Brent crude futures fell to $82.52 a barrel, losing about 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 rallied 3.1%, 2.7% and 2.6%, respectively. Volkswagen moved up 2.5% and Porsche Automobil Holding gained 2.35%.

MTU Aero Engines climbed nearly 6%. Heidelberg Materials moved up 3.5% and Deutsche Bank gained 3%. Vonovia, SAP, Continental, Siemens and Fresenius gained 2.2%-2.7%.

Scout24, Munich RE, Symrise, Allianz, Beiersdorf, Deutsche Post, Siemens Energy and Zalando also posted notable gains.

Bayer gained about 1% after the company's low-dose Gadoquatrane received FDA approval in the U.S. However, the stock pared gains subsequently and slipped into negative territory, losing about 0.2%.

Rheinmetall shed 2.25%. RWE, Brenntag, Commerzbank, Deutsche Boerse, Infineon Technologies, Deutsche Telekom and BASF fell 0.8%-1.7%.

Germany's wholesale price inflation eased in May largely due to the reduction in the energy tax on mineral oil products, data from Destatis showed Monday.

Wholesale prices increased 5.9% year-on-year in May after rising 6.3% in April.

In economic news, Destatis said the war in the Middle East pushed up wholesale prices of energy products and raw materials, in particular. Mineral oil products prices surged 30.5% from the last year. But prices dropped 7.3% from April due to the reduced energy tax rate.

Further, wholesale of non-ferrous ores, non-ferrous metals and non-ferrous semi-finished metal products advanced 36.1% in May.

On a monthly basis, wholesale prices dropped 0.6% in May, marking the first fall in five months. This reversed the 2% rise in April.