Around the World's Markets: Frankfurt

THE XETRA DAX rallied 110.1 points to close at 4,549.23 although traders warned that the gains were largely due to short covering by investors who had expected markets to respond more negatively to US President Bill Clinton's testimony on Monday. "There are so many things which are still a potential danger," one dealer said. "I think we could still see 4,000 points."

Banks recovered some of the value they shed this month, while carmakers BMW and Volkswagen benefited from a firmer dollar.