Europe open: Shares rally, oil falls on Trump pledge not to hit Iran before midterms

(Sharecast News) - European shares rallied on Friday as oil prices fell on a pledge from US President Donald Trump to bomb Iran before American midterm elections on November 3.

The pan-regional Stoxx 600 index was up 0.79% to 630 at 0714 GMT with all major regional bourses higher. Brent crude had eased to $103 a barrel from $105 on Thursday.

Trump, whose approval ratings are tanking over his handling of the war and its impact on the domestic economy, said Washington was "having productive discussions with the Islamic Republic of Iran".

"I want to make it clear to everybody that, while Iran is in very bad condition, both economically and militarily, and while the blockade will remain in full force and effect, with oil flowing in record numbers of barrels through the Hormuz Strait (22 million barrels, last night alone, with not one barrel coming from, or going to, Iran!), we will not be attacking Iran at any time prior to the midterm elections to be held in the United States on November 3rd," he said in a social media post.

Oil prices also eased after reports that China is set to resume fuel exports, following a pause in shipments during the Golden Week holiday. Traders said the return of Chinese cargoes is expected to help replenish tight global supplies of diesel, gasoline and jet fuel, adding to the downward pressure on crude.

In equity news telecom stocks were down on a report that SpaceX reached a deal to buy cellular spectrum licenses from investment firm Grain Management, its biggest move yet into a wireless market dominated by traditional telecom companies.

The Elon Musk-led space company will pay about $8bn in cash for the assets, the Wall Street Journal reported citing unnamed sources.

Shares in Deutsche Telecom, Telefonica, Orange, Vodafone, BT Group and Swisscom all fell on the news.

Reporting by Frank Prenesti for Sharecast.com