Stock markets: Milan (+1.3%) closes at a new record high on hopes for the Strait of Hormuz. Crude oil prices fall again
Wall Street also hit record highs. Oil prices reversed course once again and closed lower after Bessent spoke of an imminent reopening of the Strait. The defence sector led the way on the Milan Stock Exchange, with Leonardo and Avio at the forefront, alongside tech stocks
(Il Sole 24 Ore Radiocor) - The apparent thaw in relations between the United States and Iran, which has reignited hopes of an agreement to reopen the Strait of Hormuz, has pushed up European stock markets and triggered a further correction in oil prices. The FTSE MIB on the Milan Stock Exchange thus recorded a new closing high of 53,541 points (+1.26%), having risen during the session to 53,613, and posted the best performance among European stock markets. US Treasury Secretary Scott Bessent said that the US is ‘in talks’ with Tehran and that ‘there is a possibility that an agreement could be reached on Tuesday or Wednesday to reopen the Strait and move towards greater normalisation in this conflict’.
On Wall Street, the Dow Jones and S&P hit new records
Wall Street closed with a bullish rally, amid a euphoric atmosphere fuelled by hopes of the Strait of Hormuz reopening, which in turn triggered further slumps in oil prices. At the close of trading, the Dow Jones was up 1.71 per cent, the S&P 500 – which hit new all-time highs with an intraday peak of 7,758 points – closed up 1.79 per cent, and the Nasdaq closed up a buoyant 2.59 per cent.
Defence and tech sectors perform well in Milan
Among the leading stocks on the Milan stock exchange, STMicroelectronics rose by 3.6 per cent in a technology sector that is gaining ground across Europe (the Stoxx sub-index was up 3.01%), partly thanks to the results of groups such as Palantir and Caterpillar, buoyed by demand for artificial intelligence solutions. There was buying interest in Avio (+4.66%) and Prysmian (+3.47%), with the latter seeing its share price rise in the wake of the acquisition of the US firm Atkore. Banks were generally up (Bper +2.14% and Banco Bpm +2.08%), despite new statements from League leader Matteo Salvini regarding a possible contribution to finance the cut in fuel excise duties. Eni (-1.88%), meanwhile, slipped to the bottom of the FTSE MIB index, following the fall in crude oil prices.
Crude oil reverses course; gas prices also fall
The comments by US Treasury Secretary Scott Bessent, who told CNBC that the United States and Iran could reach an agreement within days to reopen the Strait of Hormuz, have caused oil prices to reverse course and fall once again. Consequently, WTI, the US benchmark, fell by 5.81 per cent to $75.67, whilst Brent, the international benchmark, lost 5.35 per cent and slipped to $79.29. Natural gas prices also fell, with prices on theAmsterdam TTF platform fell by 3.2 per cent to €55.7 per megawatt-hour. On the foreign exchange market, the euro/dollar exchange rate remained stable at 1.151, with the single currency and the greenback regaining ground against the yen.
Spread closes lower at 76 points; 10-year yield falls to 3.88%
Yields across the euro yield curve closed lower, having benefited from optimism over a possible new peace agreement between the US and Iran. At the close of trading on the secondary market, the yield spread between the benchmark 10-year BTP and the German bond of the same maturity stood at 76 basis points, down from 79 basis points at Monday’s close. The yield on the benchmark 10-year BTp fell more sharply, closing at 3.88 per cent, down from 3.94 per cent at the previous close.
