European equity markets moved lower on Friday as fading optimism over a swift resolution to the Iran conflict and ongoing concerns about oil supply disruptions weighed on sentiment.
By 07:04 GMT, the Stoxx Europe 600 was down 0.4%. Germany’s DAX slipped 0.1%, France’s CAC 40 lost 0.4%, and the UK’s FTSE 100 also declined by 0.4%.
Fragile Ceasefires and Rising Tensions
Donald Trump announced on Thursday that a ceasefire between Israel and Lebanon would be extended by three weeks following discussions with officials from both nations. However, the absence of Hezbollah representatives from the talks has raised doubts about how durable the agreement will be.
Earlier in the week, Trump also introduced an open-ended ceasefire arrangement between the U.S. and Iran, while maintaining restrictions on Iranian ports.
Uncertainty continues to surround the situation. Iran responded to the U.S. measures by asserting control over the Strait of Hormuz—through which around one-fifth of global oil supplies pass—targeting several vessels in the area. In response, the U.S. has seized Iranian-flagged ships, and Trump stated he had instructed the Navy to “shoot and kill” Iranian boats attempting to deploy mines in the strait.
Oil Prices Climb Above $100
With little indication that the Strait of Hormuz will reopen in the near term, oil prices have climbed back above $100 per barrel. This has intensified concerns about rising inflation and the potential impact on global economic growth.
Earnings in Focus
Alongside geopolitical developments, investors are also monitoring corporate results across Europe.
Shares of SAP (TG:SAP) rose more than 5% after the company reported a 17% increase in first-quarter profit, exceeding market expectations, supported by strong performance in its cloud business.
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