London (AFP) – Oil prices and stock markets jumped Friday as traders tracked headlines on the chances for peace in the Middle East, while also eyeing mixed corporate earnings and some positive economic data. European equities posted solid gains in midday deals after Asia closed out the week higher. World oil prices rose around two percent and the dollar climbed against main rivals.
“Nobody really knows where these [US-Iran] negotiations are heading, but for now, markets are doing what they often do when a potential geopolitical off-ramp appears — tentatively moving as if the good news could be around the corner,” said Matt Britzman, senior equity analyst at Hargreaves Lansdown. The US and Iran have a “50-50” chance of reaching an agreement that would free up the Strait of Hormuz, according to a senior UAE official.
US Secretary of State Marco Rubio meanwhile said talks to end the war could progress, with help from Pakistani mediators to help strike an agreement. President Donald Trump warned this week that negotiations were on the “borderline” between a deal and renewed strikes. A key sticking point remains the Strait of Hormuz, which is effectively closed to around one-fifth of global energy supplies.
“The market continues to think that a deal between the US and Iran is likely, even if we have had mixed messages from both sides,” said Kathleen Brooks, research director at XTB trading group. In Europe, German business morale unexpectedly increased in May, a survey showed Friday, raising hopes that Europe’s biggest economy is weathering the Iran war energy shock better than feared. The Ifo institute’s confidence barometer rose to 84.9 points from 84.5 in April, the first time it has gone up since the start of the Mideast conflict, and confounding analyst expectations for a slight decrease.
Futures contracts were indicating a higher opening on Wall Street, building on gains seen Thursday as traders reacted to chip giant Nvidia’s latest earnings update. While the company revealed that its daily revenue should reach $1 billion during the current quarter, the company’s shares failed to win a boost after surging through much of May.
– Key figures at around 1045 GMT –
Brent North Sea Crude: UP 2.4 percent at $105.07 a barrel
West Texas Intermediate: UP 1.8 percent at $98.13 a barrel
London – FTSE 100: UP 0.3 percent at 10,475.12 points
Paris – CAC 40: UP 0.3 percent at 8,112.65
Frankfurt – DAX 30: UP 0.7 percent at 24,772.74
Tokyo – Nikkei 225: UP 2.7 percent at 63,339.07 (close)
Hong Kong – Hang Seng Index: UP 0.9 percent at 25,606.03 (close)
Shanghai – Composite: UP 0.9 percent at 4,112.90 (close)
New York – DOW: UP 0.6 percent at 50,285.66 points (close)
Euro/dollar: DOWN at 1.1598 from $1.1622 on Thursday
Pound/dollar: DOWN at 1.3422 from 1.3439
Dollar/yen: UP at 159.12 from 158.91 yen
Euro/pound: DOWN at 86.42 from 86.48 pence
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© 2024 AFP
