German Shares Rise on US-Iran Deal Breakthrough
German equities started a new trading week in the green as the US and Iran agreed to sign a peace deal.On Monday, the blue-chip DAX index closed 1.09% higher.Under a newly announced 60-day framework, Washington and Tehran are scheduled to sign a memorandum of understanding in Switzerland on Friday, aimed at permanently ending military hostilities and reopening the Strait of Hormuz. Although official terms are not yet public, media reports suggest the deal will also trade a lifted US naval blockade for the partial release of Iran's frozen assets, waived oil sanctions, and continued negotiations over its nuclear program."This deal, if it holds, is the most workable outcome available to all parties at the table, which gives it a degree of credibility. Washington has an incentive to avoid a spike in gasoline prices ahead of the midterms, while Tehran is seeking sanctions relief and restored export revenues, and the global economy has a strong interest in keeping the Strait of Hormuz open," Rystad Energy chief economist Claudio Galimberti said, adding that a "signed agreement is not a functioning one," with both nations demanding reciprocal first steps. Additionally, Lebanon acts as a "wildcard" beyond the absolute control of either party.Back at home, Germany's selling prices in wholesale trade were up 5.9% year over year in May, after a 6.3% jump in April. On a monthly basis, wholesale prices were 0.6% lower, compared with the expected 0.8% uptick. Destatis mainly attributed the increase to the Middle East conflict, which drove wholesale costs of energy products and raw materials higher.On the corporate side, Daimler Truck (DTG.F) announced plans to invest a mid-three-digit million-euro amount in the coming years to expand its global defense business under a new umbrella brand called Daimler Truck Defence, targeting 1 billion euros in defense revenue by 2028. The German commercial vehicle manufacturer gained 2.20%.Meanwhile, UniCredit requested a BaFin investigation into Commerzbank (CBK.F), accusing the German lender of making "misleading" public statements that allegedly disrupted its ongoing takeover bid. Denying the allegations of "unusual" share-lending activities, the Italian bank said its direct holdings and valid investor acceptances have already comfortably exceeded its initial 30% target threshold. Commerzbank was down 1.33%.