Germany’s Dax stock index hit an all-time high, becoming the first of Europe’s leading indexes to fully recover from a slide fueled by Donald Trump’s trade threats. About this informs Financial Times.
The growth was made possible by a positive backdrop: the US and the UK signed a trade deal and President Trump held a phone conversation with the new German Chancellor, Friedrich Merz. Both leaders agreed that it is necessary to resolve existing disputes as soon as possible, and Mertz called Washington an “indispensable friend and partner.”
A personal meeting between Mertz and Trump is expected to take place in the near future. Negotiations between the US and China are also scheduled for the weekend. The Chinese delegation will be headed by Vice Premier He Lifeng, the American side will be represented by Finance Minister Scott Bessent and trade representative Jamison Greer.
Despite the growth of stock markets in Europe, the American S\&P 500 index remained unchanged. At the same time, Trump said on Truth Social that an 80 percent tariff on Chinese goods “seems right,” which could temper expectations for a reduction in tariff pressure.
The Dax index shows a confident growth since the beginning of the year — by almost 18%. Investors’ optimism is supported by large-scale investments in defense and infrastructure announced by the Mertz government. Shares of Rheinmetall rose more than 170%, and Deutsche Bank rose 43%.
Unlike the US, where the S\&P 500 has lost nearly 4% since the beginning of the year, European indices are holding steady amid promises of increased defense spending and fears about the consequences of the US-China trade conflict. The yield on ten-year German bonds rose to 2.56%, although it partially lost previous gains.
