BRUSSELS/FRANKFURT/PARIS (dpa-AFX) - European stocks closed weak on Thursday, with investors closely following news about U.S.-Iran conflict and weighing the prospects of the warring nations striking a peace deal that could help re-open the Strait of Hormuz.
Also, higher oil prices stoked inflation concerns, raising the possibility of interest rate hikes by major central banks.
A report from Axios said U.S. and Iranian negotiators have reached an agreement on a 60-day memorandum of understanding to extend the ceasefire and launch negotiations on Iran's nuclear program.
Citing two U.S. officials and a regional source involved in the mediation efforts, Axios noted President Donald Trump has yet to give his final approval.
The pan European Stoxx 600 dropped 0.75%. The U.K.'s FTSE 100 ended 1.02% down, while Germany's DAX and France's CAC 40 lost 0.59% and 0.61%, respectively. Switzerland's SMI tumbled 0.9%.
Among other markets in Europe, Austria, Belgium, Czech Republic, Finland, Greece, Iceland, Ireland, Netherlands, Portugal, Russia, Spain, Sweden and Türkiye closed weak.
Denmark and Norway ended higher, while Poland closed flat.
In the UK market, AutoTrader Group, National Grid, RightMove, Severn Trent, Weir Group, Associated British Foods, DCC, Kinfisher, Intertek Group, Games Workshop, Convatec Group, Prudential and Diageo shed 2%-4%.
BT Group drifted down 3.46% after reports emerged that the British government would oppose any attempt from Sunil Bharti Mittal to raise his stake in the telecoms company beyond 25%.
Babcock International jumped 4.13%. Compass Group and BAE Systems gained about 3% and 2.7%, respectively. Antofagasta, Rolls-Royce Holdings, Anglo American Plc and Melrose Industries also closed notably higher.
In the German market, Siemens Energy fell 4.4%. Munich RE, Hannover RE, Allianz, Beiersdorf, Scout24, E.ON, Deutsche Boerse, BMW, Deutsche Telekom, RWE and Brenntag lost 1%-2.3%.
Rheinmetall rallied 4.8%. Infineon gained 4.5%. Qiagen, Deutsche Post, MTU Aero Engines, SAP and Adidas also closed notably higher.
In the French market, Dassault Systemes ended lower by more than 5.5%. Pernod Ricard, AXA, Danone, Teleperformance, Saint-Gobain, Eurofins Scientific, Bureau Veritas, Engie, Veolia Environment and Societe Generale lost 1%-2.2%.
Sanofi shed more than 1% despite FDA grating priority review for venglustat to treat Gaucher disease.
Edenred climbed 3.7% and STMicroelectronics moved up 3.2%. Thales, Airbus, ArcelorMittal and Safran gained 1.3%-2.7%.
Data from statistical office INSEE showed French domestic producer prices fell 2.1% month-on-month in April, reversing a revised 1.9% increase in March. The fall was the steepest since April last year. On an annual basis, domestic producer prices jumped 2.1%, the most since June 2023, after being flat in March.
Data released by the Society of Motor Manufacturers and Traders Limited (SMMT) showed UK car production dropped 0.7% year-on-year to a four-month low of 56,135 units in April, following a 0.8% decline in the previous month.
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