According to Investing.com, the pan-European STOXX 600 index lost 0.77%. The German DAX fell by 0.90%, the British FTSE 100 – by 0.63%, the French CAC 40 – by 0.73%.
The reason for the sell-offs were the reports of the U.S. Central Command that the U.S. destroyers while passing through the Strait of Hormuz were attacked by Iran. According to the military, missiles, drones and small vessels were used.
In response, the U.S. struck Iranian port facilities in Bandar Abbas and on Qeshm Island.
“US ‘light smack’
Tehran accused Washington of violating the ceasefire and said US forces had also attacked an Iranian oil tanker. US President Donald Trump later told reporters that the truce “technically remains in force”, calling the US strikes a “light spanking”. At the same time, he again sharply criticized Iran’s leadership and demanded that Tehran agree a new deal faster.
The new outbreak of tensions has reversed the optimism that had supported global markets just a few days ago. At that time, investors took positively reports about a possible framework agreement between Washington and Tehran to resume negotiations. It was assumed that the consultations could take place in Pakistan.
Hopes for a diplomatic settlement were reinforced by expectations of the opening of the Strait of Hormuz, which has remained virtually closed since the conflict began on February 28. A significant part of the world’s oil supplies passes through this route, so any risks to shipping are immediately reflected in energy prices.
Against the backdrop of rising oil prices, IAG, which owns British Airways, warned that its annual profit may be lower than expected due to the rise in the price of jet fuel.
