Introduction: Markets rise after Trump says Iran war will end ‘very soon’
Good morning, and welcome to our rolling coverage of business, financial markets and the global economy.
Oil prices are falling and stocks are rallying after the US president. Donald Trump He said that the war with Iran will end very soon.
Speaking from his Doral resort in Miami, the president described the war in Iran as a “little jaunt” that went “much faster than we thought.”
He said his administration was “trying to keep oil prices down”, because “they were artificially inflated by this excursion”.
The remarks sparked a relief rally in markets, even as Trump signaled that the war would not end within the next week.
Oil prices are falling sharply, with international benchmark Brent crude now down 6.8 percent at $92.19 a barrel, having crossed $100 a barrel on Monday morning.
Stock markets rose in Asia, which has been one of the regions most exposed to higher energy prices. Japan’s Nikkei 225 share index rose 2.5 percent, while South Korea’s Kospi gained 6 percent. Hong Kong’s Hang Seng index also rose 2 percent.
Although Trump has said the war could be over soon, he has also vowed that if he “does anything” to stop the flow of oil through the Strait of Hormuz, Iran will be hit “twenty times more than it has been hit so far.”
About a fifth of global oil and offshore gas tankers normally pass through the strait, which has already been closed for a week, raising concerns over energy supplies that have sent prices soaring.
Iran’s state media reported on Tuesday, citing a spokesman for the government’s Revolutionary Guards Corps (IRGC), that Tehran announced it would not allow “a single liter of oil” to be exported from the region if the US and Israeli attacks continue.
Agenda
Important events
UK house builder persimmon Its shares rose nearly 10% after reporting a rise in annual sales and profits, the best performer in Europe today.
Pre-tax profit for the year rose 11% to £397.3m, with revenue up 17% to £3.75bn. Overall new home completions rose 12%.
However Richard Hunterhead of markets at the broker Interactive Investornotes that the Iran war could weigh on the property sector. While oil prices are falling this morning, they are still high, raising concerns about inflation and reducing the likelihood of an interest rate cut.
While there were one or two interest rate cuts for this year, the current estimate is that there may actually be an increase, which will affect mortgage affordability.
That being said, there are many tailwinds that could still revive the sector. More broadly, there is a significant shortage of housing supply at household level and government reforms to planning should fuel the wheels of being able to break ground. At the same time, the group noted that for some, inflation-driven pay rises and relaxed lending rules have boosted inquiry rates and boosted growth, along with wider mortgage availability.
Still Dean FinchPersimmon’s chief executive said in a statement that the impact of the Iran conflict on consumer sentiment “remains to be seen”. He said:
Assuming the conflict with Iran and its effects are short-lived, persimmons are poised to rebound in 2026.
FTSE opens higher as global markets rally.
The UK’s blue-chip FTSE 100 share index opened 1.4% higher this morning, as global stock markets continued to experience relief.
European markets followed Asia higher with the Italian FTSE MIB up 2.4%, the German DAX up 2.1% and the French Cac 40 up 1.9%. The Stoxx Europe 600, which tracks the largest companies across the continent, is up 1.5%.
European gas prices fall
European natural gas prices continued to fall this morning, with the Dutch month-ahead gas contract (the European benchmark) down 16% to €46.59 per megawatt hour (MWh), down from €56 on Monday.
But Susannah Streeterchief investment strategist at the broker Wealth Clubhas warned that given that fighting continues and the strait is impossible, investors may still be worried.
Oil prices are 25 percent higher than before the conflict began. Trump has promised that the U.S. Navy will provide a guard for tankers through the strait, but any timeline for that is extremely vague, with forces currently focused on military infrastructure rather than escorting ships.
Until a long-term solution is found, companies and consumers are still willing to pay the price of a US-Israeli attack on Iran. The impact of an array of everyday costs affecting companies and households is becoming apparent.
Prices have already risen at the pumps, and motorists are being warned to drive more conservatively to offset further expected increases in costs. The more generous fixed-rate energy tariffs have been scrapped, and households are looking to increase the energy price cap in July. Borrowing costs are set to remain high for longer due to inflationary pressures due to higher energy costs, and better mortgage deals have been withdrawn.
Oil prices are already down more than 6% this morning, with Brent crude at $92.19 a barrel. It rose to just over $119 on Monday.
Jim Reed But Deutsche Bank says investors will be looking for signs that shipping through the Strait of Hormuz could recover from its suspended levels, especially after Saudi Arabia became the latest country to cut total oil production.
Note that oil moves are heavily embedded on the futures curve, with December 2026 Brent futures currently trading at $74.95/bbl.
We will also see if the plan to abandon oil reserves comes to fruition. Yesterday’s virtual G7 finance ministers’ meeting has yet to reach that point, with them saying they are “ready to take the necessary steps”, and France’s finance minister saying they are “not there yet”. Overnight, Japanese Finance Minister Katayama said G7 energy ministers are expected to meet today to discuss the process of releasing oil reserves.
Introduction: Markets rise after Trump says Iran war will end ‘very soon’
Good morning, and welcome to our rolling coverage of business, financial markets and the global economy.
Oil prices are falling and stocks are rallying after the US president. Donald Trump He said that the war with Iran will end very soon.
Speaking from his Doral resort in Miami, the president described the war in Iran as a “little jaunt” that went “much faster than we thought.”
He said his administration was “trying to keep oil prices down”, because “they were artificially inflated by this excursion”.
The remarks sparked a relief rally in markets, even as Trump signaled that the war would not end within the next week.
Oil prices are falling sharply, with international benchmark Brent crude now down 6.8 percent at $92.19 a barrel, having crossed $100 a barrel on Monday morning.
Stock markets rose in Asia, which has been one of the regions most exposed to higher energy prices. Japan’s Nikkei 225 share index rose 2.5 percent, while South Korea’s Kospi rose 6 percent. Hong Kong’s Hang Seng index also rose 2 percent.
Although Trump has said the war could be over soon, he has also vowed that if he “does anything” to stop the flow of oil through the Strait of Hormuz, Iran will be hit “twenty times more than it has been hit so far.”
About a fifth of global oil and offshore gas tankers normally pass through the strait, which has already been closed for a week, raising concerns over energy supplies that have sent prices soaring.
Iran’s state media reported on Tuesday, citing a spokesman for the government’s Revolutionary Guards Corps (IRGC), that Tehran announced it would not allow “a single liter of oil” to be exported from the region if the US and Israeli attacks continue.
