Mixed trend in Europe; Wall Street futures jump

14:00

Trade in Europe continues to be conducted in a mixed trend. The DAX index falls by about 0.5%, the FTSE advances by about 0.7% and the KAC loses its value by about 0.8%.

Wall Street futures are trading up as much as 1%. Currently, the Dow Jones is expected to open the day with an increase of about 0.6%, the S&P 500 is expected to climb by about 0.7% and the Nasdaq is expected to start trading with an increase of about 1%.

The increase registered in the price of Brent oil moderated slightly, after earlier during the trading day it rose to the level of 100 dollars per barrel. Now, it is climbing over 2% and is trading around $98.

The Swiss investment bank UBS points out in a review published today that ECB officials continue to signal that high energy prices may justify continued monetary tightening, despite the optimism surrounding possible progress toward an agreement in the Middle East. The bank said that European markets are now pricing in two more interest rate hikes, along with an upward revision of the 10-year German government bond yields.

However, UBS estimates that the markets are overestimating the scope of the tightening, and that yields in Europe may end the year at lower levels. According to the bank, the expected decrease in yields stems from three main factors: a balance between inflationary pressures and the moderating effect of energy prices on growth; An assessment that inflation expectations remain relatively anchored and therefore reduce the need for aggressive tightening; as well as the possibility of a diplomatic settlement in the Middle East, which may reduce energy pressures and, accordingly, the need for an austerity policy.

UBS adds that they remain positive about quality bonds and see the recent increase in yields as an opportunity, while estimating that the market tends to exaggerate the scope of the expected monetary tightening.

12:15

Trade in Europe continues to be conducted in a mixed trend. The DAX index falls by about 0.7%, the FTSE advances by about 0.6% and the KAC loses its value by about 1%.

Brent oil is currently climbing close to 4% and is trading around $100 per barrel, against the background of the Iranian response to the American attacks carried out in southern Iran during the night – as mentioned, attacks defined by the American military as “self-defense attacks”. The Revolutionary Guards responded that they reserve the right to respond to US violations of the ceasefire, and said that Iran attacked an American drone and fired at an F-35 fighter jet that entered the country’s airspace.

11:00

Trading in Europe opened this morning with a mixed trend after on Monday it reached the highest levels since March 2, amid increasing hopes for a deal between the US and Iran over the weekend. The European Stoxx index is almost unchanged, the German DAX is down 0.3% and the French CAC is down 0.4%. On the other hand, the British Potsi jumps by 0.7%.

In Italy, there was a sharp decline in the shares of the luxury car manufacturer Ferrari shortly after the launch of the company’s first fully electric vehicle. The stock traded down more than 7% on Tuesday morning, reflecting a total drop of about 27% over the past 12 months on the Milan Stock Exchange.

CNBC noted that the new electric model marks a departure from Ferrari’s design tradition, despite the fact that other luxury car manufacturers, including Porsche and Lamborghini, actually recently reduced their plans to launch electric vehicles due to weak market demand.

9:30

After a long weekend during which markets in Hong Kong and South Korea were closed for holidays, trading in Asia is mixed this morning. The Tokyo Stock Exchange fell by about 0.3%, after crossing the 65,000 points mark for the first time yesterday; The Hong Kong Stock Exchange climbs by about 0.3%, the Shanghai Stock Exchange weakens by about 0.3% and the Seoul Stock Exchange jumped by about 2.5% to a new all-time high, led by chip stocks.

In view of the progress towards an agreement between the US and Iran, yesterday oil prices recorded decreases of over 5%, but this morning, against the background of the attacks carried out by the US in the south of Iran, they are climbing this morning by about 2%. Brent crude is trading around $98 per barrel, while US crude (WTI) is trading around $92 per barrel. At the same time, on Wall Street, where there was no trading last night due to Memorial Day, the futures contracts are recording increases of up to 1%.

Trading abroad is being conducted this morning in the shadow of the attacks carried out by the USA during the night in southern Iran – attacks described by the American military as “self-defense attacks”. A spokesman for the US Army’s Central Command told Fox News that “US forces carried out self-defense strikes in southern Iran to protect our forces from threats by Iranian forces. Among the targets were missile launch sites and Iranian boats trying to lay mines. US Central Command continues to protect our forces, using restraint during the ongoing ceasefire.”

The attacks were carried out at the same time as the talks between the US and Iran, whose progress is reportedly slowing down. US Secretary of State Marco Rubio said during the night that negotiations on the wording of the deal may take several days and clarified that the Strait of Hormuz – which the Iranians insist on continuing to control – must be completely free for vessel traffic.

President Trump made it clear again during the night that the enriched uranium will be transferred to the US or destroyed inside Iran – which Iran for the time being strongly denies. Last night, Trump noted that the negotiations with Iran are “progressing in an orderly and constructive manner”, and added that he instructed his representatives “not to rush to reach an agreement, because time works in their favor”.

On Wall Street, last Friday, trading closed higher: the Dow Jones index rose 0.58%, the S&P 500 gained 0.37%, and the Nasdaq added 0.19%. However, the three indices ended the trading day below the daily record levels recorded earlier in the day.

We will remind you that the stock exchange in New York returns to trading today after concluding a positive week. The S&P 500 index climbed 0.9%, marking an eighth straight week of gains – and its longest streak of green weeks since 2023. The Nasdaq added about 0.5%, and the industrial-biased Dow Jones climbed about 2.1% to a new all-time high. Gains were supported by chip stocks, which continued their positive momentum presented in recent weeks, when the Philadelphia Stock Exchange (SOXX) rose to a new all-time high.