European stock markets rebounded during this second session of the week, driven by hopes of a resumption of negotiations between Washington and Tehran. The CAC 40 rose by 1.12% to 8,327 points while the Euro Stoxx 50 gained 1.31% to 5,982 points.
Across the Atlantic, the main American indices are trading in the green: the Dow Jones is up by 0.66% and the Nasdaq is advancing by 1.39%, heading towards a tenth consecutive session of increases, a streak unseen since 2021.
Discussions between the United States and Iran could resume as early as this week, renewing hopes for a thaw in the geopolitical situation. In this context, oil prices drop below $100, with Brent falling by 1.89% to $96.04 at the close of European markets.
According to the International Energy Agency (IEA), the war in the Middle East has caused “the most severe oil supply shock in history.” The agency also anticipates the largest demand contraction since the Covid-19 pandemic in the second quarter. “Oil demand is expected to decline by 80,000 barrels per day (b/d) this year, with the war in Iran disrupting our global outlook,” it stated in its March monthly report.
In its latest forecasts, the International Monetary Fund does not rule out the risk of a global recession in the event of a prolonged conflict, while emphasizing that this scenario is not currently its central assumption.
“The fact that a ceasefire has been agreed reduces the probability of our most pessimistic scenario, although it does not guarantee a quick return to normalcy in the Middle East and the Strait of Hormuz,” Invesco pointed out.
Tuesday’s session was also marked by quarterly results. LVMH ended close to breakeven (-0.06%) after briefly being the worst performer during the session, as the luxury giant reported quarterly sales below expectations.
The flagship index of the Paris market was boosted by Eurofins (5.52%) after announcing the sale of its electrical and electronic testing business to UL Solutions for an enterprise value of €575 million.
Meanwhile, Publicis (1.81%) had a solid session after releasing results that were generally in line with expectations.
On the currency market, the euro has gained 0.22% against the dollar to $1.1793.
