FRANKFURT (dpa-AFX) - The DAX posted significant gains on Monday after a weak start. The afternoon recovery was buoyed by strong U.S. sentiment data. Even the sharp losses in the precious metals market failed to weigh down the stock barometer in any lasting way. Instead, investors came to the conclusion that the fundamentally positive environment for equities has likely not changed.

The German blue-chip index, which had fallen below 24,400 points in the morning, ended the day up 1.05 percent at 24,797.52 points. The MDAX of mid-cap stocks also rebounded, rising 1.12 percent to 31,512.09 points. Across Europe, a similar picture emerged: the Eurozone's leading index, the EuroStoxx 50, climbed 1.00 percent to 6,007.51 points, with gains also seen in Switzerland and the United Kingdom. In the United States, both the Dow Jones Industrial and the Nasdaq indices advanced.

In the U.S., industrial sentiment improved markedly and unexpectedly in January. The closely watched ISM Purchasing Managers' Index also climbed back above the growth threshold, signaling an increase in economic activity.

Additionally, after the plunge in gold and silver prices, investor nerves calmed again. "It appears that many speculative and thus jittery hands were shaken out of the market over the weekend," commented Christine Romar, head of Europe at CMC Markets, on the trading day. She described this as a "healthy shakeout in the precious metals markets," even though the situation in gold and silver remains fragile "and thus highly toxic for the equity markets as well."

The trigger for the turmoil was the nomination of former Fed Governor Kevin Warsh as successor to U.S. Federal Reserve Chairman Jerome Powell by U.S. President Donald Trump. Since Warsh is not seen as an advocate of particularly loose monetary policy, but rather as someone inclined toward a more restrictive interest rate path to get inflation under control, this caused uncertainty. Hopes for interest rate cuts took a hit.

Those who had bet on further rising precious metals prices with borrowed money were caught off guard. Positions had to be unwound, putting further pressure on prices. Such developments can temporarily spill over into other markets, such as equities.

Defense stocks were among the biggest losers, though they have posted above-average gains so far this year. On Sunday, Ukrainian President Volodymyr Zelensky announced new talks in Abu Dhabi next week aimed at ending Russia's war of aggression. Rheinmetall lost 3.0 percent at the bottom of the DAX. In the MDAX, TKMS fell 1.2 percent, Renk 3.2 percent, and Hensoldt 5.1 percent.

Analysts provided positive impetus for individual stocks. Shares in food delivery service Delivery Hero rebounded 8.9 percent, largely recovering from losses over the past three trading days. Andrew Ross of Barclays Bank sees further upside potential of over 50 percent for the stock. On one hand, he is confident that recent regulatory changes in Qatar and Kuwait, where subsidiary Talabat operates, should be resolved in the second half of the year. On the other hand, he sees possible M&A transactions as another important price driver.

Shares in Nemetschek gained 4.0 percent, benefiting from a buy recommendation by Bank of America. Analyst Victor Cheng sees an attractive entry point for the construction software company's stock, given opportunities in the field of artificial intelligence.

Norma also rose 4.0 percent. The automotive supplier and connection technology specialist plans, as previously announced, to distribute part of the proceeds from the sale of its water management business to shareholders following the completion of the transaction./ck/he

--- By Claudia Müller, dpa-AFX ---