German police hunt an Islamic State supporter after a van struck crowds at Berlin's Pride festival. Traders weigh the hit to travel stocks and the shift in security spending.
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German police on Sunday were searching for a 21-year-old suspect named Abdul B., identified by local media as an Islamic State supporter, after a van drove into crowds at Berlin's Pride festival. The attack killed one woman and left at least 16 people injured.
Chancellor Friedrich Merz called it "an attack on our society." Police said the suspect had prior links to Islamist groups. The manhunt was ongoing.
European equity markets opened lower. The DAX fell in early trading. Deutsche Lufthansa and TUI shares dropped. So did stocks of companies with retail exposure in Berlin. Defense contractors, including Rheinmetall, gained. Traders said the move reflected expectations of higher security spending. US equity futures also slipped, with Apple and other big tech names tracking the European decline.
The attack follows a pattern of vehicle-ramming assaults that have put public-event security under scrutiny across Europe. Germany's interior ministry has faced pressure to expand surveillance powers. A debate over deportations of failed asylum seekers has intensified since the incident.
Traders said the immediate market impact was contained to travel and leisure. "The macro read-through is limited unless the investigation uncovers a wider network," one Frankfurt-based fund manager said. "The security-sector read-through is the bigger story for equity investors over the next quarter."
The suspect's alleged Islamic State affiliation has become a central issue in the political debate ahead of state elections in Saxony and Thuringia, where migration and security are top concerns. Merz's coalition government has already moved to tighten border controls.
Police have not said whether other suspects are being sought. The investigation is ongoing.
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