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Germany’s leading stock market index, the DAX, climbed to a record 23,476 points on Tuesday, boosted by the prospect of a multibillion-euro spending package to enable investments in infrastructure and defence.
The DAX reached its latest record high before lawmakers in the Bundestag, the lower house of parliament, approved a historic easing of the country’s debt limit in the afternoon, to boost defence spending and earmark €500 billion ($547 billion) for infrastructure and climate protection measures.
The DAX, which measures the performance of 40 leading German companies on the Frankfurt Stock Exchange, dropped again to 23,380.70 at the close of trading – an increase of 0.98%.
The DAX has now gained over 17% since the start of the year.
The MDax, which includes medium-sized companies, saw even larger gains, climbing by 1.55% to 29,970.08, while Germany’s SDAX index of 70 small and medium-sized companies rose by some 3%.
The package passed by the Bundestag signals to companies that funds will be available, said Thomas Gitzel from VP Bank.
“This provides reliability and companies can in turn invest in the appropriate machinery and capacity expansion,” he added.
The spending package still has to be approved by the Bundesrat, the upper house comprised of the leaders of Germany’s 16 federal states, on Friday.
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