Europe midday: Oil stocks help markets rebound from three-week low

(Sharecast News) - Stocks across Europe edged higher on Tuesday after hitting a three-week low, despite oil prices continuing the rise, with trading rangebound ahead of some key risk events for financial markets later in the week.

The Stoxx 600 was trading 0.1% higher at 609.67 by around the midday mark in Central Europe, after falling to its lowest since 7 April on Monday.

Markets across the UK, Frankfurt and Paris were posting tepid gains. However, benchmarks in Milan and Madrid were up 1.2% and 0.9%, respectively, on the back of decent performances in the heavyweight banking and oil industries.

"European markets are in the green, despite the ongoing rise in energy prices that has seen Brent crude top $110 once again," said Joshua Mahony, chief market analyst at Scope Markets.

Oil prices continued to climb as investors awaited Donald Trump's response to a peace proposal from Iran, with reports suggesting he was unlikely to accept it because it sets aside any discussions about Tehran's nuclear program until the war is ended. According to Reuters, citing a US official, the proposal is unlikely to satisfy the US, which says nuclear issues must be dealt with from the outset.

Brent crude was 2.7% higher at $104.45 a barrel, while WTI gained 3.3% to $99.52 a barrel.

"The continued ascent of crude oil prices, serves as a stark reminder of the tightening supply side picture in the face of ongoing blockades in the Strait of Hormuz. [...] As oil and gasoline prices continue to rise, the possibility of a soft landing is narrowing, with inflationary pressures and shortages expected to build over the coming weeks," Mahony said.

Energy stocks across the continent were on the rise, led by BP after posting a better-than-expected first-quarter profit as it benefited from a surge in oil and gas prices due to the Iran war, with "exceptional" oil trading contribution and stronger midstream performance.

Underlying replacement cost profit - BP's preferred measure - came in at $3.2bn in the first three months of the year, up from $1.4bn in the same quarter a year earlier, and from $1.5bn in the final quarter of 2025. This was ahead of analysts' expectations of $2.6bn.

Sector peers Shell, Repsol and ENI were also on the rise.

Norwegian Air Shuttle gained as it reported a narrowing of its quarterly losses, with its load factor hitting a record high for a first quarter. The carrier said results benefitted from a "focus on cost control and robust operational performance in an uncertain macroeconomic environment".

On the downside, Barclays fell as it said credit impairment charges increased to �823m in the first quarter from �643m in the same period a year earlier but also posted a 6% jump in revenue and a 3% rise in pre-tax profit.

Novartis was sharply lower as the Swiss pharmaceutical group's first-quarter operating profit and sales fell short of analysts' expectations.