FRANKFURT (dpa-AFX) - The Dax defied the lack of progress in Middle East peace negotiations on Monday. By the close of trading, the German benchmark index edged up 0.05 percent to 24,350.28 points. Last week, however, it had reached its highest level since the start of the conflict in late February, hitting over 25,150 points on signals of de-escalation. The MDax, which tracks mid-cap companies, ultimately rose by 0.86 percent to 31,448.76 points on Monday.
Efforts to end the conflict between the U.S. and Iran are once again at risk of stalling. U.S. President Donald Trump described Iran's latest response to his proposal for a diplomatic solution as 'completely unacceptable'. He issued further threats against the Islamic Republic, which remained unfazed and presented its own set of demands. Israeli Prime Minister Benjamin Netanyahu intends to continue the war until key issues regarding the Iranian nuclear program are resolved. Oil prices rose at the start of the week in response to these statements.
The investor reaction to the disappointing news from the Middle East was 'decidedly moderate', commented Marcel Mussler, editor of the eponymous stock market newsletter. He noted it was 'very striking that equity markets are currently much more receptive to positive news than negative news'. However, the conflict cannot be ignored as long as a new escalation remains a possibility.
Other market observers also pointed to Trump's upcoming state visit to China later this week. Investors are 'currently looking for any topic that can provide a brief respite from the Middle East crisis, hoping for new momentum in the relationship between Washington and Beijing as well as positive signals for the global economy', wrote analyst Timo Emden./gl/he
