Investing.com – European stock markets gained on Tuesday, mirroring advances in Asian equities, after U.S. President Donald Trump said the conflict in Iran would be over “very soon.”
By 04:05 ET (08:05 GMT), the pan-European had climbed by 1.8%, the in Germany had gained 2.2%, the in France had moved up 1.6%, and the in the U.K. had risen 1.4%.
On Monday, Trump suggested in a press conference that the U.S. campaign in Iran may soon come to a conclusion, although he warned that he may escalate attacks on Tehran’s should oil slows be stemmed through the vital Strait of Hormuz waterway, through which a fifth of the world’s oil supply passes.
Iranian leadership, meanwhile, reportedly vowed to continue its own bombardments and not allow oil flows through the strait should the joint U.S.-Israeli strikes go on.
“The U.S. will remain in the game, but more in the guise of a tidy-up exercise. Big market moves in consequence. Now the dust settles,” analysts at ING including Padhraic Garvey said in a note.
Oil prices, which gyrated wildly in the prior session as traders reacted to both fears around continued violence and hopes for an easing in the fighting in the joint U.S-Israeli assault against Iran, were lower.
At 09:43 ET, , the global benchmark, had dropped by 7.4% to $91.58 a barrel, while U.S. West Texas Intermediate crude futures slipped by 7.0% to $88.13 a barrel.
Global bond yields edged down broadly as well, as the oil price decline helped soothe some jitters that a crude shock could fuel a spike in inflationary pressures that may force central banks to possibly pursue interest rate hikes.
Officials at the European Central Bank have flagged that a protracted conflict in Iran could drive up living expenses, while ongoing oil market volatility could make the outlook for rates murkier. At the moment, investors are pricing in at least one rate hike by the ECB this year, according to LSEG data cited by Reuters.