Europe midday: Shares up, oil down as markets ignore US sanctions package

(Sharecast News) - European shares were higher on Tuesday as investors essentially ignored the latest raft US sanctions against Iran while Tehran pledged to retaliate against any measures that harmed its economy, while oil fell below $90 a barrel.

The benchmark Stoxx 600 index was up 0.54% to 657,78 at 1056 GMT with all major regional bourses higher.

US Treasury Secretary Scott Bessent on Monday launched 'Operation Economic Outcast' and compared it with the D-Day Normandy landings in the second world war to drive the Nazis out of France.

However, the measures are not immediate, with Bessent claiming Washington was "giving everyone the opportunity to remedy bad behaviour".

"Why would I want to blow up the global financial system? We believe that it is important to level set and give people a cure period, but they should know that that will move very quickly and that we are serious," he added.

It was not clear whether the US would include China in its threatened action against countries that trade with Iran.

Brent crude fell 2.83% to $89 on the news.

Germany's DAX outperformed with a 0.81% rise as domestic economic growth slowed less than expected in the second quarter of 2026, according to revised estimates from the country's federal statistical office on Tuesday.

Gross domestic product rose at a 0.3% clip on a price, seasonally and calendar-adjusted basis in the April-June period, Destatis reported, down from 0.4% growth in the first quarter but the third straight quarterly expansion.

That was an increase from the 0.2% expansion initially reported last month. Notably, turnover in wholesale and retail trade performed much better than expected, while export figures were upwardly revised.

Meanwhile, a separate survey by the Ifo Institute showed German business sentiment improved more than expected in August.

The business climate index rose to 88.8 from 86.7 in July, coming in above expectations for a reading of 87.2. This marked the fourth consecutive monthly increase and took the index to a one-year-high.

In equity news, shares in UK defence manufacturer Melrose surged after the company said it would launch a $100m claims programme for residents and businesses affected by the May evacuation around the Garden Grove facility in the US run by its GKN Aerospace unit, after a chemical tank containing thousands of gallons of methyl methacrylate overheated and forced authorities to clear a wide area for several days.

Vistry also soared as the UK housebuilder was given £350m in taxpayer cash to help build social housing.

German medical equipment maker Gerresheimer tumbled after the surprise resignation of interim CEO Uwe Rohrhoff.

Reporting by Frank Prenesti for Sharecast.com