European shares soared on Wednesday at their fastest pace in a year after US president Donald Trump signalled that the Iran war could end soon, prompting investors to scale back expectations for further interest rate hikes by big central banks.
The pan-European Stoxx 600 index jumped 2.5 per cent, the most 12 months, recouping some of last month’s losses on hopes a resolution of the war is near.
Brent crude oil had fallen below $102 a barrel by the time European markets closed, having yesterday been as high as $118 a barrel.
The US will end its war on Iran fairly soon and could return for “spot hits” if needed, Trump told Reuters on Wednesday, hours before he was scheduled to make a prime-time address to his nation.
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Dublin
The Iseq All-Share index advanced 1.7 per cent to 12,263.35, though it remains down more than 6 per cent so far this year.
Ryanair stood out, soaring 4.5 per cent to €24.95, as oil prices declined.
Iran’s cyber-attacks on Irish-based companies and the ongoing impact of conflict in the Middle East
Glenveagh Properties added 2.3 per cent to €1.98 and Cairn rose 1.7 per cent to €15.61, amid hopes that inflation will be contained and central banks will not need to pursue another cycle of rate hikes.
However, rate-sensitive banking stocks underperformed, with AIB edging only 0.3 per cent higher to €9.04 and Bank of Ireland adding 1.1 per cent to €15.61.
London
The blue-chip FTSE 100 closed up 1.8 per cent, while the midcap FTSE 250 climbed 2.2 per cent. On Tuesday, both the indexes marked their biggest monthly drop since 2020 on fears that the war-led increase in oil prices will stoke inflation.
Aerospace and defence also added to gains, up 5.7 per cent, providing the biggest boost to the benchmark index.
UK food prices will be rising by almost 10 per cent by the end of 2026 due to the Iran war, the country’s food and drink manufacturers’ lobby warned, about three times faster than its previous forecast.
British factory cost pressures soared in March, and delivery delays – due to ships avoiding the Strait of Hormuz – were the longest since mid-2022, according to an S&P Global survey.
Berkeley fell 9.6 per cent after the home builder forecast that profit growth would slow through 2030. The firm said it would halt land purchases as the war and the risk of higher interest rates dampened hopes of a housing market recovery.
Europe
Sportswear Puma jumped 5.5 per cent, even after US- based rival Nike forecast a surprise drop in fourth-quarter sales. Adidas was also well ahead early in the session but closed up just 0.2 per cent.
Meanwhile, index provider MSCI said Greek stocks will return to its developed markets index in May 2027. Greece’s benchmark index closed 3.2 per cent higher.
German gas turbine producer Siemens Energy jumped 7 per cent, recouping a big share of its 15 per cent decline in March.
New York
Wall Street’s main indexes were ahead in early afternoon trading, after posting their biggest one-day gain in nearly a year, following Trump’s comments.
“You have to be extremely careful on how you approach what’s being said, because there’s been a lot of false starts,” said Robert Pavlik, senior portfolio manager at Dakota Wealth.
“When it [the market] gets down to correction levels, he comes out and says these things ... And all of a sudden, it blows up on you and you’re back to square one or even worse.”
Meanwhile, Nike slumped to a decade low after the sportswear giant forecast a surprise drop in its fourth-quarter sales.
Technology shares continued to rise for a second day. Chip makers were among the biggest boosts.
Intel jumped after the company said it would buy back Apollo’s stake in its Ireland factory for $14.2 billion (€12.2 billion).
Airlines jumped and defence stocks staged a recovery, making industrial shares on the S&P 500 the biggest percentage gainers.
Nonfarm payroll figures for March will be in focus on Friday, although US markets will be closed for the Good Friday holiday. – Additional reporting: Reuters
