European equities traded modestly higher on Wednesday as a sharp decline in oil prices helped ease concerns over inflation and the outlook for interest rates. Sentiment improved amid renewed optimism surrounding diplomatic efforts involving Iran and the possibility that shipping through the Strait of Hormuz could resume sooner than previously expected.
Brent crude futures fell around 3% to $84.56 a barrel following reports that Oman and Iran had discussed creating a temporary joint maritime corridor through the Strait of Hormuz.
Stoxx 600 advances while FTSE 100 slips
The pan-European Stoxx 600 gained 0.12%, while Germany’s DAX advanced 0.18% and France’s CAC 40 climbed 0.43%.
London underperformed its continental peers, with the FTSE 100 slipping 0.13% despite strength among major mining companies.
Antofagasta (LSE:ANTO) rose 2.5%, while Anglo American Plc (LSE:AAL) gained 1.2%. Glencore (LSE:GLEN) and Rio Tinto (LSE:RIO) also recorded moderate advances.
Elsewhere in London, Diploma (LSE:DPLM), Halma (LSE:HLMA), Howden Joinery Group (LSE:HWDN), Intercontinental Hotels Group (LSE:IHG), Persimmon (LSE:PSN), Games Workshop (LSE:GAW), Airtel Africa (LSE:AAF), Spirax Group (LSE:SPX), IAG (LSE:IAG), Weir (LSE:WEIR), Coca-Cola HBC (LSE:CCH), Aberdeen Group (LSE:ABDN) and JD Sports Fashion (LSE:JD.) gained between 1% and 2.3%.
Deutsche Bank and Heidelberg Materials lead German gains
In Frankfurt, Deutsche Bank and Heidelberg Materials were among the strongest performers, with both stocks climbing around 4.3%.
Commerzbank, MTU Aero Engines, Qiagen, Symrise, E.ON, Rheinmetall, Fresenius, Beiersdorf, Fresenius Medical Care and Continental advanced between 1% and 2.3%.
SAP moved in the opposite direction, dropping approximately 3%. Porsche Automobil Holding, Scout24, Volkswagen and Siemens Energy declined between 1% and 1.4%.
UK retail survey points to weaker sales
Economic data from the UK added a more cautious element to the session. The Confederation of British Industry reported that its headline sales balance deteriorated to -48 in August from -26 in July.
The reading was substantially weaker than the market forecast of -24, highlighting continued pressure on UK retail activity.
Overall, European markets remained slightly positive as lower energy prices provided some relief from inflation concerns, although mixed economic data and weakness in selected heavyweight stocks kept gains contained.
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