German stocks prove to be flavor of the month

German stocks, rejected by investors in April, are luring them back in May.

Buyers added the most in a year - more than 570 million euros ($638 million) - to the biggest exchange-traded fund tracking the equities last week. The benchmark DAX Index had its biggest jump in two months on Friday, and options data show traders are betting on further gains. The most-owned contract is calling for a 2.5 percent advance by June.

After the DAX's biggest monthly loss since July, valuations have sunk to their lowest level this year relative to Europe's equities. The decline is a good opportunity to invest in German companies, according to Didier Duret of ABN Amro Bank NV's wealth-management unit. Economists have increased the nation's growth forecast each month this year, raising the appeal of its shares.