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(Sharecast News) - European shares surged and oil prices plunged on Wednesday as the US and Iran agreed a conditional two-week truce which included the opening of the vital Strait of Hormuz waterway.
The pan-regional Stoxx 600 index was up 4.05% to 614 at 1145 BST with all major bourses rallying on the news. Germany's DAX gained 5%, while France's CAC 40 rose 4.6%, Italy's MIB 3.84% and Spain's IBEX 3.96.
Having threatened to wipe out Iranian civilisation, US President Donald Trump on Tuesday said he had agreed "to suspend the bombing and attack of Iran for a period of two weeks" as long as Tehran agreed to the "complete, immediate, and safe opening of the Strait of Hormuz".
Oil prices predictably plunged as a result, with Brent crude down 14% to $93.96 a barrel and US benchmark West Texas Intermediate 16% lower at $94.50.
Both are still well above the $72 and $65 levels respectively on February 27 - the day before the US and Israel started their war of choice on Iran which resulted in the effective closure of the Strait of Hormuz.
However, the news was tempered by Israel and the UAE reporting missiles and drones from Iran being fired in their direction and triggering air defenses.
In equity news, oil stocks were sharply lower in line with the oil price. Equinor, BP, Var Energi, Repsol, ENI, Galp and Shell were all in the red.
Airlines and leisure stocks were major winners, with TUI, easyJet and Lufthansa all higher.
Away from the war, retail sales across the eurozone fell back as expected in February, with weakness in the region's two largest economies providing a drag, according to figures from Eurostat on Wednesday.
The seasonally adjusted volume of retail trade decreased by 0.2% over the month of February, in line with market forecasts following no change in January.
Meanwhile the gloom in eurozone construction deepened as activity contracted at the steepest rate in five months in March, according to S&P Global data on Wednesday, as a surge in input price pressures pushed cost inflation to a 40-month high.
The S&P Global eurozone construction purchasing managers' index fell to 44.6 in March from 46.0 in February, marking the sharpest decline in activity - marked by any figure below 50 - since October 2025.
The regional PMI has now remained below the neutral mark for the past 47 months.
Reporting by Frank Prenesti for Sharecast.com