Global stock markets rallied after US President Donald Trump said Washington and Iran were in the “final stages” of negotiations to end the Middle East conflict.
London’s FTSE 100 climbed 1.1%, while on Wall Street the tech-heavy Nasdaq Composite jumped 1.2% as hopes of a diplomatic breakthrough triggered a sharp decline in oil prices and eased pressure on global bond markets.
Brent crude tumbled 5.2% towards USD103 per barrel as investors reacted to growing optimism that tensions in the region may begin to ease following months of conflict and disruption around the Strait of Hormuz.
Government borrowing costs also moved sharply lower after Trump told reporters “we’ll see what happens” regarding ongoing discussions with Tehran, signalling possible progress in negotiations.
Bond markets had come under intense pressure in recent sessions amid fears that escalating tensions between the US and Iran would drive inflation higher and force central banks to maintain tighter monetary policy.
In the UK, benchmark gilt yields fell back below 5% for the first time since Andy Burnham announced plans to return to Parliament, helping support broader market sentiment.
