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  • European stocks edge lower as Hormuz tensions rise after failed talks: DAX, CAC, FTSE100

    European stocks edge lower as Hormuz tensions rise after failed talks: DAX, CAC, FTSE100

    European equity markets traded broadly weaker on Monday, following the breakdown of weekend negotiations in Islamabad and a U.S. naval move to restrict shipping linked to Iran through the Strait of Hormuz.

    Escalating geopolitical tensions lifted Brent crude above $102 per barrel, renewing concerns around inflation and the outlook for interest rates.

    Germany’s DAX fell 1.2%, France’s CAC 40 declined 0.9%, while the U.K.’s FTSE 100 slipped 0.5%.

    Vistry Group (LSE:VTY) was among the biggest fallers after naming internal candidate Adam Daniels as its new chief executive.

    National Grid (LSE:NG.) also traded lower after issuing a pre-close update ahead of its full-year results.

    In contrast, Halma (LSE:HLMA) advanced in London after the group announced the $90 million acquisition of California-based Surgistar, a specialist in ophthalmic surgical tools and devices.

  • Five market drivers to watch in the coming week

    Five market drivers to watch in the coming week

    Geopolitical tensions are setting the tone at the start of the trading week, with the U.S. decision to impose a blockade in the Strait of Hormuz fuelling volatility. The move has lifted oil prices once again, while upcoming inflation data and a packed earnings calendar could shape sentiment in the days ahead.

    1. U.S. begins Hormuz blockade

    The U.S. military has confirmed it will implement restrictions on vessels linked to Iran in the Strait of Hormuz from 10 a.m. Eastern on Monday, following an order from President Donald Trump after weekend talks with Tehran broke down.

    The Pentagon said ships “entering or departing Iranian ports and coastal areas” will be affected, while vessels not tied to Iran will still be able to transit the waterway.

    The move follows 21 hours of negotiations in Pakistan that failed to secure an extension to the fragile two-week ceasefire. Vice President JD Vance, who led the U.S. side, said Iran rejected demands to curb its nuclear program. Pakistan, which mediated the talks, urged both parties to “uphold their commitment to ceasefire.”

    Meanwhile, separate talks between Israel and Lebanon are due in Washington this week, though ongoing strikes on Hezbollah-linked targets continue to cast doubt over the durability of a broader regional truce.

    2. Oil prices surge past $100 again

    Crude markets rallied on Monday, with prices climbing back above the $100 per barrel mark.

    Brent crude rose 6.7% to $101.65, while U.S. West Texas Intermediate gained 7.1% to $103.42.

    Despite the sharp move, Pepperstone analysts described the reaction as “relatively contained,” suggesting investors largely see the blockade as a negotiating tactic rather than an immediate supply shock.

    “I’d not be at all surprised to see risk assets remain underpinned to a degree, with continued hope that a deal can be agreed likely to continue to encourage dip buying, even as crude benchmarks are likely to grind steadily higher as physical supply tightens further,” said Michael Brown, Senior Research Strategist at Pepperstone.

    Oil had briefly fallen below $100 last week after the ceasefire announcement, which came after Trump warned Iran’s “civilization” could be destroyed if the Strait of Hormuz remained closed. Even so, prices continue to trade well above pre-conflict levels.

    3. Focus turns to U.S. producer prices

    The rebound in energy costs has heightened concerns about inflation and its implications for global monetary policy.

    Investors will be watching closely for U.S. producer price index (PPI) data this week, which will reflect price trends in March—the first full month impacted by the Iran conflict.

    Recent consumer price figures already showed a notable rise, driven largely by higher fuel costs. Energy prices increased 12.5% year-on-year, up sharply from 0.5% in February.

    However, core inflation—excluding food and energy—came in below expectations at 2.6% annually and 0.2% month-on-month.

    Given this softer core reading, analysts suggest the Federal Reserve may take a measured approach when interpreting inflation data. The upcoming PPI release could provide further clarity on the outlook for interest rates.

    “A stronger-than-expected [PPI] reading would reinforce the case for a ‘higher for longer’ rate outlook, likely supporting the dollar and leaving EUR/USD’s recent rebound vulnerable to renewed downside,” said Laurence Booth, Global Head of Markets at CMC Markets.

    4. Bank earnings kick off reporting season

    The U.S. earnings season gathers momentum this week, starting with results from major financial institutions.

    Goldman Sachs (NYSE:GS) is among the first to report, with its stock up about 3% year-to-date. Trading revenues have benefited from portfolio adjustments linked to developments in artificial intelligence, while its investment banking arm has also shown growth.

    However, the conflict in Iran could weigh on outlooks. While market volatility can boost trading activity, higher commodity prices may deter companies from pursuing large transactions such as mergers and acquisitions, potentially impacting advisory revenues.

    Other banks set to report include JPMorgan Chase (NYSE:JPM), Wells Fargo (NYSE:WFC), Citigroup (NYSE:C), Bank of America (NYSE:BAC) and Morgan Stanley (NYSE:MS).

    Outside the banking sector, results are also expected from Netflix and PepsiCo.

    5. European luxury earnings in spotlight

    In Europe, attention will also turn to the luxury sector, where several major players are due to report.

    LVMH (EU:MC) will release first-quarter sales, with geopolitical developments likely to influence its outlook. Rivals Kering SA (EU:KER) and Hermès (EU:RMS) are also scheduled to report.

    Reuters has reported that luxury sales in hubs such as Dubai and Abu Dhabi have weakened due to the conflict, weighing on the roughly $400 billion sector.

    Meanwhile, ASML (EU:ASML is set to report on Wednesday, with investors focused on its ability to meet strong demand from artificial intelligence chipmakers.

  • UK equities already factoring in downturn risks after ceasefire, says Goldman Sachs

    UK equities already factoring in downturn risks after ceasefire, says Goldman Sachs

    UK equities have adjusted sharply enough to reflect near-recession conditions in the wake of the US-Iran conflict, with mid-cap valuations suggesting flat or even slightly negative economic activity, according to a recent note from Goldman Sachs.

    The FTSE 250 is currently trading around the 15th percentile of its historical price-to-earnings range, while most global equity markets are positioned much higher, between the 80th and 95th percentiles, the bank said. Its economists have also revised down their UK growth outlook, cutting their Q4/Q4 GDP forecast to 0.6% from 1.5% prior to the conflict.

    “UK stocks have been quick to discount and are arguably overly discounted in some cases,” Goldman Sachs noted, adding that FTSE 250 valuations are “likely consistent with activity running at zero or slightly negative.”

    The announcement of a two-week ceasefire between the U.S. and Iran helped trigger a global rebound in equities, as energy prices eased from recent highs. Goldman Sachs’ commodities team expects flows through the Strait of Hormuz to begin normalising over the weekend, followed by a gradual recovery in Persian Gulf exports over the course of a month.

    The bank has slightly lowered its second-quarter Brent crude forecast to $90 per barrel, while leaving its outlook for the third and fourth quarters of 2026 unchanged at $82 and $80 respectively.

    Energy’s contribution to UK headline inflation is expected to shift from a negative 0.1 percentage point in February to a positive 0.3 percentage point in March, with further increases anticipated in April, Goldman Sachs said.

    The UK PMI output prices index also rose in March, exceeding levels that would typically be implied by movements in oil and gas prices, with price pass-through in the services sector proving stronger than in the euro area.

    Goldman Sachs highlighted that UK cyclical stocks have underperformed defensive names more significantly than in the U.S. or eurozone. Retail stocks within the FTSE 350 have declined more than would be suggested by GfK UK Consumer Confidence data alone.

    Domestic-focused UK equities, tracked through the GSSTUKDE basket, have diverged from their usual relationship with GBP/USD over the past year. Despite a stronger pound, these stocks have lagged, with their relative performance against the FTSE 100 nearing lows last seen in 2022.

    The FTSE 100 closed at 10,603 on April 9, trading on a 12-month forward price-to-earnings ratio of 13.0 and offering a dividend yield of 3.3%, compared with a forward P/E of 20.4 for the S&P 500, Goldman Sachs said. The bank maintains a 12-month target of 10,800 for the index.

    On the rates side, Goldman Sachs noted that current pricing in real estate and housebuilder stocks suggests higher yields are already reflected in valuations. “With weak economic growth, we expect gilt yields to moderate,” the bank said. The UK 10-year gilt yield currently stands at 4.8%, with Goldman Sachs projecting a decline to 4.4% over the next 12 months.

  • Oil surges past $100, dollar firms and equities retreat as U.S. tightens stance on Iran

    Oil surges past $100, dollar firms and equities retreat as U.S. tightens stance on Iran

    Oil prices jumped sharply on Monday after the United States moved to restrict Iranian-linked shipping following the collapse of weekend peace talks, while the dollar strengthened and both equities and sovereign bonds came under pressure.

    The U.S. step, designed to increase leverage on Tehran, has put a fragile ceasefire at risk and extended uncertainty around Middle East energy flows, even as market participants hold out cautious hopes for a diplomatic breakthrough.

    Brent crude rose 7% to roughly $102 per barrel—up more than 40% since the conflict disrupted traffic through the Strait of Hormuz. Meanwhile, Europe’s STOXX 600 index declined 0.8%, and S&P 500 futures slipped 0.6%.

    Government debt markets also weakened. U.S. Treasuries sold off, pushing yields on benchmark 10-year notes up 2 basis points to 4.33%, while European bonds followed, with Germany’s 10-year yield rising 1 basis point to 3.06%.

    “Markets, as the week gets underway, are trading in rather ‘textbook’ risk-off fashion, as participants reach once more for the ‘conflict escalation’ playbook,” said Michael Brown, strategist at Pepperstone.

    “Losses are seen elsewhere, with equity futures in the red on both sides of the pond, gold rolling over, and govvies facing some headwinds too. All these moves, though, it must be said, are relatively contained in the grand scheme of things,” he added.

    The Wall Street Journal reported that President Donald Trump and his advisers are weighing the possibility of limited military action against Iran, although no immediate strikes were reported during Asian trading hours.

    Trump said on Sunday that oil and gasoline prices could stay elevated through the U.S. midterm elections in November, acknowledging the potential domestic political consequences of the conflict.

    “The market is now largely back to conditions before the ceasefire, except now the U.S. will block the remaining up to (2 million barrels) Iranian-linked flows through the Strait of Hormuz as well,” said MST Marquee analyst Saul Kavonic.

    “The key remaining question is if the U.S. renews strikes on Iran, raising the risk of strikes on energy infrastructure across the region which could have a further lasting impact beyond the duration of the war.”

    Dollar strengthens as inflation concerns intensify

    In currency markets, the euro fell about 0.3% to $1.1692, while risk-sensitive currencies such as the Australian dollar also edged lower.

    The surge in energy prices has prompted investors to reassess the outlook for monetary policy, with expectations shifting toward the possibility that central banks—including the European Central Bank and the Bank of England—may need to tighten policy, reversing earlier assumptions of rate cuts or extended pauses.

    Recent U.S. inflation figures showed consumer prices rose at their fastest pace in nearly four years in March, driven largely by higher gasoline costs. Money markets now suggest traders see less than a 20% chance of a Federal Reserve rate cut this year.

    In emerging markets, the Hungarian forint rallied strongly, reaching multi-year highs against both the dollar and the euro after Prime Minister Viktor Orbán was voted out of office following 16 years in power, replaced by a centre-right coalition in Sunday’s election.

    The outcome is expected to unlock European Union funding flows to Hungary and Ukraine.

    “The positive political developments have triggered a powerful rally for the forint,” said MUFG currency strategist Lee Hardman.

    “The price action reinforces the forint’s position as one of the best-performing emerging market currencies this year.”

  • Gold slips as stronger dollar and inflation concerns weigh on demand

    Gold slips as stronger dollar and inflation concerns weigh on demand

    Gold prices edged lower on Monday, pressured by a firmer U.S. dollar after ceasefire negotiations between Washington and Tehran failed to deliver progress, prompting investors to shift toward the greenback as a safe-haven asset.

    The metal was also dragged down by robust U.S. inflation data released on Friday, which dampened expectations for near-term interest rate cuts from the Federal Reserve.

    Spot gold declined 0.6% to $4,720.67 per ounce as of 01:06 ET (05:06 GMT), while gold futures dropped 0.9% to $4,743.20 per ounce.

    Other precious metals weakened as well, with spot platinum easing to $2,047.06 per ounce and spot silver falling nearly 2% to $74.3975 per ounce.

    Dollar strengthens as U.S.-Iran tensions persist

    The U.S. dollar index rose around 0.4%, supported by increased demand for safe-haven assets after talks between the U.S. and Iran ended without meaningful breakthroughs.

    Extended discussions held in Pakistan over the weekend failed to ease tensions, with disagreements continuing over Iran’s nuclear program, the situation in the Strait of Hormuz, and Tehran’s backing of militant groups across the Middle East.

    U.S. President Donald Trump responded by ordering a naval blockade of the Strait of Hormuz, later clarifying that the action would be directed specifically at Iranian ports and vessels.

    The blockade, set to begin at 10:00 ET (14:00 GMT), raises the risk of further escalation. Iran has strongly opposed the move.

    Inflation pressures add to gold’s downside

    Gold also came under pressure following U.S. consumer price data showing a notable rise in inflation in March, largely driven by higher energy costs linked to the conflict.

    Annual CPI increased to 3.3% in March, slightly below forecasts of 3.4% but significantly higher than the 2.4% recorded in February.

    The data intensified concerns that elevated oil and gas prices—driven by the conflict—could push inflation higher globally. The Strait of Hormuz, a critical route for energy shipments, has remained largely closed since late February, and the planned U.S. blockade further dims prospects for a near-term reopening.

    Following the CPI release, expectations for Federal Reserve rate cuts over the coming year were scaled back further, according to CME FedWatch data. This outlook tends to weigh on gold and other non-yielding assets, as higher interest rates reduce their appeal.

    Concerns about prolonged elevated rates have overshadowed gold’s traditional role as a safe haven, while the metal’s strong rally into late 2025 has also limited fresh buying interest.

    U.S. producer price index data is due later this week.

  • Markets slip on Hormuz tensions as oil rises; Goldman Sachs results in focus: Dow Jones, S&P, Nasdaq, Wall Street Futures

    Markets slip on Hormuz tensions as oil rises; Goldman Sachs results in focus: Dow Jones, S&P, Nasdaq, Wall Street Futures

    U.S. equity futures pointed lower at the start of the week, as concerns over a potential naval blockade of the Strait of Hormuz and stalled talks between Washington and Tehran dampened investor sentiment. Oil prices climbed back above $100 per barrel, with markets questioning how long the fragile U.S.-Iran ceasefire can hold. Attention is also turning to upcoming earnings from Goldman Sachs (NYSE:GS), which will help kick off the U.S. reporting season, alongside results from LVMH (EU:MC).

    Futures point to a weaker open

    U.S. stock futures declined on Monday as investors weighed renewed geopolitical risks after President Donald Trump warned of a possible blockade of the Strait of Hormuz following unsuccessful weekend negotiations with Iran.

    At 03:28 ET, Dow futures were down 239 points, or 0.5%, S&P 500 futures fell 40 points, or 0.6%, and Nasdaq 100 futures dropped 168 points, or 0.7%. European and Asian markets also traded unevenly, while oil prices surged and the dollar strengthened.

    Wall Street had finished Friday on a mixed note, as investors remained cautious ahead of the high-stakes discussions in Pakistan. A temporary two-week ceasefire was agreed last week, but doubts remain over whether it can evolve into a lasting peace.

    Traders are also digesting inflation data showing a sharp rise in consumer prices in March, driven largely by higher gasoline costs tied to the energy shock from the conflict. Oil has rallied since late February, when tensions escalated and tanker movements through the Strait of Hormuz—responsible for roughly one-fifth of global oil flows—were severely disrupted.

    Trump signals move on Hormuz

    On Sunday, Trump said the U.S. Navy would impose an “immediate” blockade of the Strait to restrict shipping.

    He warned that vessels paying tolls imposed by Tehran would not be assured “safe passage on the high seas.”

    The Pentagon later clarified that restrictions would apply to ships “entering or departing Iranian ports or coastal areas,” while other vessels would still be permitted to pass through the Strait.

    The announcement follows 21 hours of talks between U.S. and Iranian officials in Pakistan, which ended without an agreement to extend the ceasefire. Vice President JD Vance, who led the U.S. delegation, said Iran had rejected demands to curb its nuclear program. Tehran has yet to respond publicly, while Pakistan—acting as mediator—urged both sides to “uphold their commitment to ceasefire.”

    Oil reclaims $100 level

    Crude prices surged again on Monday, pushing back above the $100 threshold.

    Brent crude rose 6.7% to $101.65, while U.S. West Texas Intermediate gained 7.1% to $103.42.

    Despite the rally, analysts at Pepperstone described the market response as “relatively contained,” suggesting investors see the blockade as part of a negotiating strategy.

    “While it’s clearly a risk-averse start to the trading week, […] the general market reaction can be summed up as ‘could be worse’,” said Michael Brown, Senior Research Strategist at Pepperstone.

    Oil had slipped below $100 last week following the ceasefire announcement, which came after Trump warned Iran’s “civilization” could be destroyed if the Strait remained closed. Even so, prices remain elevated compared to pre-conflict levels.

    Goldman Sachs earnings ahead

    Focus now shifts to results from major U.S. banks, starting with Goldman Sachs ahead of the opening bell.

    Shares in Goldman have risen about 3% year-to-date, supported by strong trading volumes as investors reposition portfolios amid the rise of artificial intelligence. Its investment banking division has also shown resilience.

    However, the conflict in Iran could overshadow the results. While market volatility can boost trading income, persistently high commodity prices may discourage companies from pursuing large deals such as mergers and acquisitions, potentially weighing on advisory revenues.

    Other major banks reporting this week include JPMorgan Chase (NYSE:JPM), Wells Fargo (NYSE:WFC), Citigroup (NYSE:C), Bank of America (NYSE:BAC) and Morgan Stanley (NYSE:MS).

    LVMH to report

    LVMH (EU:MC), the world’s largest luxury goods company and owner of brands such as Louis Vuitton and Dior, is set to release first-quarter sales later today, with the Middle East conflict likely to influence its outlook.

    According to Reuters, luxury sales in hubs such as Dubai and Abu Dhabi have weakened due to the conflict, affecting companies like LVMH as well as rivals including Kering SA (EU:KER) and Hermès (EU:RMS).

    At Dubai’s Mall of the Emirates, luxury sales reportedly dropped by as much as 50% in March, while footfall at Dubai Mall fell by a similar margin. In Abu Dhabi’s Galleria mall, overall sales declined by around 10%.

    Although the Middle East accounts for a relatively small share of LVMH’s revenue, analysts cited by Reuters believe the impact on profitability—reported on a half-year basis—could be more pronounced.

  • European equities slip as Hormuz blockade threat and failed Iran talks unsettle markets: DAX, CAC, FTSE100

    European equities slip as Hormuz blockade threat and failed Iran talks unsettle markets: DAX, CAC, FTSE100

    European stock markets started the week on a weaker footing, as investors reacted to the collapse of weekend negotiations between the U.S. and Iran and renewed tensions following President Donald Trump’s warning of an “immediate” blockade of the Strait of Hormuz.

    By 07:13 GMT, the pan-European Stoxx 600 index was down 0.8%. Germany’s DAX had fallen 1.2%, France’s CAC 40 declined 1.0%, and the UK’s FTSE 100 dropped 0.6%.

    Trump said on Sunday that the U.S. would move to restrict vessels entering or leaving the Strait of Hormuz, a critical global shipping route that has become a focal point in the Middle East conflict. He cautioned that any ship paying a toll imposed by Tehran would not be guaranteed “safe passage on the high seas.”

    Later, the Pentagon clarified that the restrictions would apply specifically to ships “entering or departing Iranian ports or coastal areas,” while other vessels would still be able to pass through the Strait. Around 20% of global oil supply flows through this narrow passage off Iran’s southern coast.

    “[T]he language seemed to soften what the president posted,” analysts at Vital Knowledge said in a note to clients. “What initially looked like a complete halt to all traffic now looks like it is focused only on Iranian vessels.”

    At the same time, The Wall Street Journal reported that Trump is considering limited military strikes against Iran, which analysts suggested may indicate that the administration could be “pivoting away aggressively from a resumption” of the broader bombing campaign that had been ongoing since late February.

    These developments follow 21 hours of talks between U.S. and Iranian officials in Pakistan, which ended without securing a longer-term ceasefire beyond the current two-week pause in hostilities.

    Market participants are now turning their attention to upcoming Eurozone inflation data later this week, which may shed light on how the conflict is influencing price pressures. Europe relies heavily on energy imports from the Persian Gulf, including natural gas from Qatar, where infrastructure has been affected by the expanding conflict.

    The European Central Bank has indicated it is closely monitoring inflation risks linked to the situation. Interest rate futures currently suggest expectations of around three 25-basis-point rate increases by the ECB through the end of 2026, according to LSEG data cited by Reuters.

    Oil markets reacted strongly, with Brent crude climbing back above $100 per barrel after briefly falling below that level last week following the announcement of a temporary ceasefire.

    In corporate news, shares of Kering SA (EU:KER) resumed trading after being briefly halted following a drop of more than 3% in early dealings. Morgan Stanley downgraded the stock to “equal weight” from “overweight,” noting that much of the expected turnaround appears already reflected in the share price.

    Elsewhere, travel and leisure stocks across Europe were under pressure, while Italian energy company Eni (BIT:ENI) and defence group Leonardo (BIT:LDO) both posted gains.

  • Energy shares advance globally as oil pushes back above $100 on Hormuz tensions

    Energy shares advance globally as oil pushes back above $100 on Hormuz tensions

    Global oil and gas stocks moved higher on Monday as crude prices climbed past the $100-per-barrel mark, following U.S. action to restrict maritime activity linked to Iran in the Strait of Hormuz after negotiations between Washington and Tehran broke down.

    Brent crude rose 7.3% to $102.16 per barrel by 08:35 GMT, while U.S. West Texas Intermediate jumped roughly 8% to $104.24. Both benchmarks had ended the previous session lower before rebounding sharply.

    The surge in oil prices lifted energy equities across major markets. In the U.S., ExxonMobil (NYSE:XOM) and Chevron (NYSE:CVX) each gained more than 2% in premarket trading, while ConocoPhillips (NYSE:COP) rose 3.4% and Occidental Petroleum (NYSE:OXY) added 3.1%.

    Across Europe, BP plc (LSE:BP.) and Shell plc (LSE:SHEL) both climbed around 1.4%, while TotalEnergies (EU:TTE) edged up 1.3% and Repsol (BIT:1REP) gained roughly 2%.

    U.S. President Donald Trump said on Sunday that the Navy would move to enforce a blockade in the Strait of Hormuz, escalating tensions after prolonged talks with Iran failed to yield an agreement and putting a fragile two-week ceasefire at risk. He also cautioned that fuel prices could remain elevated through the November midterm elections.

    U.S. Central Command confirmed the measure would take effect at 10 a.m. ET on Monday, targeting vessels traveling to and from Iranian ports in the Arabian Gulf and Gulf of Oman. However, ships transiting the Strait between non-Iranian ports would not be affected, according to CENTCOM.

    The latest escalation follows a brief period of calm after a ceasefire had allowed shipping routes to reopen, sending oil prices sharply lower last week before the current rebound.

    Rabobank energy strategist Joe DeLaura had warned during last week’s dip that markets were underestimating risks, arguing that futures were “far too optimistic” and that there was “so much risk to the upside” still not reflected in prices.

    “There’s permanent production loss from the shut ins in Saudi, Kuwait, UAE and Iraq. Refinery and pipeline damage plus the physical restart times, on top of the backlog of 800+ tankers trapped on the west side of the Strait,” he told Investing.com.

    “Brent futures seem to have a floor around $90, and I think no ceasefire (no easy opening of a mined strait of Hormuz) means that futures will eventually have to start matching physical markets around $120-130/bbl (or more!).”

  • European airline stocks drop as oil prices surge following U.S. move against Iran

    European airline stocks drop as oil prices surge following U.S. move against Iran

    European airline shares declined sharply on Monday, falling between 2.7% and 7.7%, as a spike in oil prices added pressure to the sector. Brent crude climbed 8% to $102.78 per barrel by 09:00 GMT, weighing on carriers such as Ryanair (NASDAQ:RYAAY), International Airlines Group (LSE:IAG), Lufthansa (TG:LHA), Air France-KLM (EU:AF), easyJet (LSE:EZJ) and Wizz Air (LSE:WIZZ).

    During the session, Brent reached an intraday peak of $103.49 per barrel, while U.S. benchmark WTI rose 7.2% to $96.03.

    The move in oil markets followed an order from U.S. President Donald Trump directing the Navy to impose a blockade on Iranian ports after ceasefire negotiations with Iran broke down over the weekend in Pakistan.

    According to U.S. Central Command, the blockade targeting maritime traffic to and from Iranian ports was scheduled to begin at 10:00 ET on Monday. The measure is more limited than earlier proposals to block all vessels transiting the Strait of Hormuz.

    The U.S. delegation in Pakistan was led by Vice President JD Vance, who departed early on Sunday after 21 hours of talks failed to produce an agreement.

    Key sticking points included Iran’s nuclear programme, the reopening of the Strait of Hormuz, and Tehran’s backing of proxy groups such as Hezbollah in Lebanon.

    Iran signalled it does not intend to resume nuclear discussions with Washington, while Trump indicated he was unconcerned about whether negotiations restart.

    Meanwhile, The Wall Street Journal reported that governments in the Middle East are attempting to facilitate further dialogue between the United States and Iran.

    Iran has restricted access through the Strait of Hormuz since late February, disrupting roughly 20% of global oil supply and contributing to ongoing volatility in energy markets.

  • Kering falls after Morgan Stanley downgrade as Gucci concerns persist

    Kering falls after Morgan Stanley downgrade as Gucci concerns persist

    Kering SA (EU:KER) shares dropped more than 3% after Morgan Stanley lowered its recommendation on the stock, shifting its rating from “overweight” to “equal-weight” and trimming its 12–18 month price target to €320 from €330. The bank pointed to limited further upside following strong share price performance earlier in the year, which it believes is now largely reflected in the valuation.

    The stock had reached a year-to-date peak of €320.50 on 12 January before falling around 16% by Monday. Since the start of the year, it has still outperformed peers including LVMH, Hermès and Richemont by roughly 300 to 1,700 basis points.

    After surging 10.90% on 10 February—its largest single-day gain of the period—the shares gave back much of those gains during a sharp sell-off in early March, declining 5.04% and 6.35% on 2 and 3 March respectively.

    Morgan Stanley’s discounted cash flow model suggests around 15% upside to the revised target price, though the bank no longer views this as sufficient to justify outperformance.

    “Our DCF implies 15% upside to the shares, which no longer translates into relative outperformance,” the note stated.

    Based on the bank’s updated 2028 earnings per share forecast of €15.97—down 4% from previous estimates but still 15% above the Visible Alpha consensus of €13.80—the stock is trading at about 17 times forward earnings.

    The analysts expect group revenue to reach €18.3 billion by 2028, representing roughly 25% cumulative growth from €14.7 billion in 2025. Over the same period, operating margin is projected to expand from 12.5% in 2026 to 18.4% in 2028, while EPS is forecast to rise from €6.81 to €15.97.

    The downward revisions were attributed to weaker-than-anticipated channel checks in the first quarter of 2026 and exposure to geopolitical tensions in the Middle East, which accounts for around 5% of group sales.

    Morgan Stanley now expects Gucci, Kering’s largest brand, to post a 6.2% decline in the first quarter of 2026, compared with a previous estimate of a 5% drop. Gucci is projected to generate €5.95 billion in revenue in 2026, increasing to €7.67 billion by 2028.

    In a more optimistic scenario, the bank values the shares at €480, assuming a strong revival cycle at Gucci and group operating margins reaching 25.9% by 2028. In contrast, the downside case sees the stock at €175, based on the risk that Gucci’s new direction fails to gain traction commercially. Options pricing suggests a roughly 28.9% probability that the shares exceed €320 over the next 12 months, versus a 17.1% chance of falling below €175.

    Morgan Stanley highlighted two key triggers that could shift its stance more positively: continued organisational changes following the appointment of Luca de Meo as CEO in September 2025, and clearer evidence of a sustained turnaround at Gucci.

    The analysts described Gucci’s situation as “a classic case where improving buzz is running ahead of the hard numbers,” adding that channel checks across European retailers show “early signs of improving brand buzz but little evidence yet of a meaningful commercial recovery.”