Highlights:
- Germany’s DAX index rises 0.9% as election results ease investor concerns.
- Just Eat Takeaway shares skyrocket 53% after Prosus announces $4.3 billion acquisition.
- MDAX posts its biggest daily gain in over a year, led by fintech and real estate stocks.
- U.K.’s National Grid sells U.S. renewable energy business for $1.74 billion to Brookfield.
- German federal election outcome could drive higher defense spending, Deutsche Bank says.
German Stock Market Gains on Political Stability
The German stock market surged on Monday, with the DAX index rising 0.9%, as investors reacted positively to the federal election results. The pan-European Stoxx 600 index climbed 0.2%, driven by utilities and auto stocks.
The CDU/CSU alliance secured the largest vote share, positioning Friedrich Merz as the likely next Chancellor of Germany, replacing Olaf Scholz. The political shift reduced market uncertainty, lifting investor sentiment.
Just Eat Takeaway Jumps 53% on $4.3 Billion Prosus Acquisition
Shares of Just Eat Takeaway soared 53% after tech investor Prosus announced a $4.3 billion takeover deal. The acquisition aims to strengthen Prosus’ food delivery business, though its stock fell 7% in response.
Germany’s MDAX Hits One-Year High with 2.3% Gain
Germany’s MDAX index, which tracks midcap stocks, jumped 2.3%, marking its biggest daily gain since 2023.
- Hypoport (fintech firm) surged 8%, leading the rally.
- TAG Immobilien, Evotec, and Jungheinrich gained over 5%.
- Real estate firm Vonovia, utility giant E.On, and arms manufacturer Rheinmetall climbed 4%.
- Automakers Porsche, Volkswagen, Mercedes-Benz, and BMW posted strong gains.
National Grid Sells U.S. Renewables Arm for $1.74 Billion
The U.K.’s National Grid announced the sale of its U.S. renewable energy business to Brookfield Asset Management for $1.74 billion. The division operates solar, wind, and battery storage projects across the U.S.
German Election Outcome Could Lead to Higher Defense Spending
Following the German federal election, Deutsche Bank analysts predict a rise in defense spending. The CDU/CSU and SPD coalition is expected to prioritize national security and military funding amid global geopolitical tensions.
- Election results:
- CDU/CSU: 28.6%
- AfD (far-right): 20.8%
- SPD (Olaf Scholz’s party): 16.4%
Recent NATO discussions have suggested increasing defense spending to 3% of GDP. Germany, currently at 2.12%, could raise this to 2.5% by 2026, according to analysts.
Potential Challenges in Defense Budget Expansion
Funding remains a key challenge, as modifying Germany’s debt brake rule would require political negotiations with fringe parties. Economists warn that significant policy compromises will be needed to increase spending.
