U.S. President Donald Trump recently expressed confidence that the war with Iran could soon be brought to an end. Israel and Lebanon agreed to a ten-day ceasefire on Thursday, potentially removing a major obstacle to a broader peace agreement in the Middle East. According to Trump, a renewed meeting between negotiating delegations from the U.S. and Iran could take place as early as this weekend.
OIL PRICES RETREAT FURTHER FROM 100-DOLLAR MARK
Relief spread across the oil market in light of recent developments. Prices for North Sea Brent and U.S. WTI crude fell by as much as 3.8 and 4.7 percent respectively, reaching 95.57 and 90.26 dollars per barrel. The Iranian blockade of the Strait of Hormuz, through which one-fifth of global oil exports are transported, had caused Brent and WTI prices to skyrocket since the start of the war in late February. At times, prices flirted with the 120-dollar mark. Rising energy costs have recently fueled concerns over inflation and the economic outlook. According to Frank Sohlleder of ActivTrades, investors are yearning for a single piece of redeeming news: the immediate reopening of the Strait of Hormuz. However, it remains entirely unclear when this might occur. Nick Twidale, Chief Market Strategist at ATFX Global, noted that concrete evidence is still lacking to prove that peace hopes are actually materializing.
In the foreign exchange market, the euro continued its recent recovery, trading at nearly 1.18 dollars. The single currency has gained almost two and a half percent over the past two weeks. Increasing inflationary pressure due to higher energy prices and the resulting interest rate speculation have made the euro more attractive again, according to a commentary by LBBW. Futures markets are already pricing in two ECB key interest rate hikes of 25 basis points each by the end of the year, while the U.S. Federal Reserve is expected to merely pause its cycle of further rate cuts. The dollar index edged lower on Friday.
UBER INCREASES STAKE IN DELIVERY HERO
On the corporate front, shares of SAP and Deutsche Börse were among the top gainers, rising 3.7 and 2.5 percent respectively. In the MDax, Delivery Hero made headlines as U.S. ride-hailing giant Uber increased its stake in the food delivery firm to approximately seven percent. Delivery Hero shares rose by up to 6.4 percent.
In the SDax, Gerresheimer was a focal point of discussion. According to insiders, the embattled packaging group rejected a takeover approach from its U.S. rival Silgan. Gerresheimer shares briefly tumbled five percent on the news but recovered quickly. The stock has been under pressure for months as the company grapples with accounting issues.
On the Paris Stock Exchange, shares of Siemens rival Alstom suffered a dismal session, plunging by a third. The French train manufacturer scrapped its target for cumulative free cash flow of 1.5 billion euros by the end of the 2026/27 fiscal year on Thursday evening. Furthermore, the group lowered its target for adjusted operating margin (Ebit) to 6.5 percent by the end of 2026/27, down from the previous range of eight to ten percent. Analysts at Citigroup commented that the preliminary outlook was even more pessimistic than expected.
(Report by: Daniela Pegna. Contributions: Sanne Schimanski, edited by Kerstin Dörr. For inquiries, please contact our editorial team at berlin.newsroom@thomsonreuters.com (for politics and economics) or frankfurt.newsroom@thomsonreuters.com (for companies and markets).)
