11:54 AM EDT, 05/06/2026 (MT Newswires) -- Germany's blue-chip DAX index closed Wednesday's session 2.24% in the green, joining a global rally buoyed by renewed optimism over a possible end to the Iran war.

Mentioning "great progress"toward a definitive resolution, US President Donald Trump announced a pause on efforts to escort vessels out of the Strait of Hormuz "to see whether or not the Agreement can be finalized and signed."Reuters reported, citing an unnamed Pakistani mediator, that the two nations are nearing the finalization of a one-page memorandum intended to cease hostilities in the region.

Back at home, final business survey data showed Germany's private sector contracted for the first time in almost a year. According to S&P Global, the final Germany composite PMI output index fell to 48.4 in April from 51.9 a month earlier, above the initial reading of 48.3. For the service sector, the final PMI came in at 46.9, in line with the flash estimate and against the previous month's 50.9.

"The chances of the German economy contracting in the second quarter have now risen after a slump in services business activity in April. Unlike the manufacturing sector, which has been supported to an extent by stockbuilding efforts, the services economy has felt the immediate effects of the Middle East war on demand and has seen its steepest drop in activity in nearly three and a half years,"S&P Global Market Intelligence economics associate director Phil Smith said.

In corporate news, BMW Group (BMW.F) was among the top performers, closing 5.41% higher, as RBC Capital Markets looked past lower first-quarter revenue to note a better-than-expected automotive EBIT and reiterated full-year 2026 guidance despite the latest US tariff threat. The German carmaker's revenue was down 8.1% to 31.01 billion euros.

"Despite recent news that the EU to US import tariff on autos would return to 25%, BMW reaffirmed its '26 guidance and anticipates a [125-basis-point] impact due to tariffs for the year. BMW expressed confidence that a deal will be reached - specifically anticipating that EU tariffs on US imports will drop to 0% in H2/26, and that Mexico/Canada tariff reductions will also take effect in H2/26. Our math implies that consensus Automotive EBIT could move higher for the remainder of '26,"the research firm wrote.

Continental AG (CON.F) was also among the day's top stocks, rising 8.95% at close. The German automotive parts manufacturer reported first-quarter sales of 4.40 billion euros, down 10.4% year over year but slightly above the 4.39 billion-euro consensus, and maintained its full-year revenue outlook of 17.3 billion to 18.9 billion euros despite geopolitical uncertainty.