Frankfurt's DAX closed about 1.6% up at 23,644 on Tuesday, its highest since June 16, as investors welcomed strong fiscal spending plans, positive economic data, and signs of easing Middle East tensions. Germany’s cabinet approved draft budgets with €115.7 billion in investment for 2025 and €123.6 billion for 2026, up from €74.5 billion in 2024, aimed at stimulating growth. The government also announced plans to raise defense spending to 3.5% of GDP by 2029 ahead of a key NATO summit on defense spending. Meanwhile, Fed Chair Jerome Powell reiterated in his speech to Congress that he is in no rush to cut rates, emphasizing the central bank’s commitment to keeping inflation in check amid persistent global risks. Travel stocks and building materials firms led the rally, with Deutsche Lufthansa soaring 7% and Heidelberg Materials adding nearly 6%, reflecting a risk-on sentiment as the Israel-Iran ceasefire appeared to hold. Deutsche Bank, Siemens Energy and Volkswagen followed closely.