London (AFP) – Markets largely steadied Wednesday as traders waited to see if Mideast peace talks resume, though share prices of Gucci parent Kering and French luxury group Hermes tumbled on weak earnings linked partly to the conflict’s fallout. President Donald Trump on Tuesday said a second round of US-Iran talks could take place “over the next two days,” fuelling hopes for a deal that would reopen the Strait of Hormuz and allow crude to flow again.
Senior Pakistan sources told AFP the country was working to bring the two sides back together, with one saying negotiators were working to extend the current two-week ceasefire. At the same time, Israel and Lebanon agreed to direct negotiations after a rare face-to-face meeting in Washington.
– Luxury sector hit –
In European midday trading, London and Frankfurt were little changed after most Asian indices closed higher. Paris was down 0.7 percent overall, however, as shares in fashion groups Kering and Hermes plunged after both reported sales that missed analyst expectations. The groups blamed the weaker sales in part on the Middle East war, which has hit business in a key region.
Kering’s first-quarter revenues were down three percent at comparable currency rates, dragged down again by its flagship Gucci brand, where sales dropped eight percent. Its share price slumped more than 10 percent in reaction. Hermes shed almost nine percent after the luxury handbag maker reported sales down 1.4 percent, as a stronger European single currency made its items more expensive for buyers abroad.
Elsewhere on Wednesday, world oil prices rebounded about one percent after hefty losses Tuesday, when a Wall Street rally propelled the Nasdaq and S&P 500 back well above pre-war levels. Offsetting hopes of fresh peace talks, the United States turned the screws Wednesday with a naval blockade it said had cut off maritime trade with Iran. Some observers warned that while the end of the war would be widely welcomed, there were big question marks over what a peace would look like economically given that crude production would take some time to get back up to capacity.
“Even if there’s a breakthrough this week and the Strait of Hormuz reopens relatively quickly, supply snarl-ups for a range of essential commodities from oil and gas, fertiliser and helium are likely to take considerable time to unwind,” noted Susannah Streeter, chief investment strategist at Wealth Club.
– Key figures at 1030 GMT –
Brent North Sea Crude: UP 1.2 percent at $95.90 a barrel
West Texas Intermediate: UP 0.9 percent at $92.14 a barrel
London – FTSE 100: FLAT at 10,608.35 points
Paris – CAC 40: DOWN 0.7 percent at 8,266.64
Frankfurt – DAX: DOWN 0.1 percent at 24,023.64
Tokyo – Nikkei 225: UP 0.4 percent at 58,134.24 (close)
Hong Kong – Hang Seng Index: UP 0.3 percent at 25,947.32 (close)
Shanghai – Composite: FLAT at 4,027.21 (close)
New York – Dow Jones: UP 0.7 percent at 48,535.99 (close)
Euro/dollar: DOWN at $1.1779 from $1.1797 on Tuesday
Pound/dollar: DOWN at $1.3549 from $1.3564
Dollar/yen: UP at 158.97 yen from 158.84 yen
Euro/pound: FLAT at 86.93 pence
© 2024 AFP
