EMEA Morning Briefing : Hopes for U.S.-Iran Talks, Cease-Fire Extension Boosts Mood

MARKET WRAPS

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EU CPI; U.K. GDP, trade, index of production; trading updates from Schroders, Tesco, Pirelli, Pernod Ricard, Rentokil Initial, Bang & Olufsen, Entain, Lagardere

Opening Call:

European stock futures were broadly higher early Thursday. Asian stock benchmarks gained; the dollar and Treasury yields edged lower; oil was mixed, while gold futures rose.

Equities:

Stock futures were broadly tracking higher in Europe as efforts continue for further peace talks and extension of the U.S.-Iran cease-fire. President Trump said on Truth Social that "leaders of Israel and Lebanon will speak tomorrow." White House press secretary Karoline Leavitt said Wednesday that conversations with the Iranians "are productive and ongoing."

Prospects of the U.S.-Iran cease-fire being extended have helped to improve sentiment, OCBC Group Research said. "Markets continue to pay close attention to geopolitical headlines as we inch closer to the weekend, which may see risk appetite curtailed," it said.

Forex:

The dollar weakened slightly early Thursday, as hopes for a U.S.-Iran deal boosted appetite for riskier assets. "Markets are now pricing in a diplomatic resolution between U.S. and Iran amid reports of ongoing talks," DBS Group Research said. "Risk assets [are] rallying," it said.

Bonds:

The euro-denominated high-yield credit market recorded weak performance in the first quarter due to the Middle East conflict, BNP Paribas Asset Management said. The segment had a strong start to 2026 as European corporates had strong financial positions. However, the start of the war led to reduced demand for risky assets, hurting euro high-yield debt. The asset class performance since the start of the year stands at minus 1.65%, it said.

"The [risk assets] selloff erased the gains accumulated earlier in the quarter and highlighted the asset class's sensitivity to energy prices and to shifts in rates expectations."

Energy:

Oil futures were mixed amid prospects of further U.S.-Iran negotiations that could lead to reduced supply disruptions in the Middle East. "The two parties are reported to be considering extending their ceasefire by another two weeks to allow for more time to negotiate a peace agreement, " ANZ Research analysts said.

"Mediators are said to be pushing for a compromise on outstanding issues including the reopening of the Strait of Hormuz and Iran's nuclear enrichment program," they said.

Metals:

Gold rose. A possible U.S.-Iran deal is a key variable for gold, The Revacy Fund's Zaheer Anwari said. "If tensions ease and oil prices fall, that could reduce short-term inflation pressure and ease some of the upward pressure on yields, which may support gold," the co-founder and CEO said.

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Copper gained. Prospects of the Mideast conflict ending have eased concerns of slowing economic growth, with signals pointing to stronger copper demand in China, the ANZ Research team said. March imports of copper ore and concentrate rose 6.6% on year, suggesting strong demand from domestic smelters. Meanwhile, Chinese fabricators have also stepped up purchases to take advantage of the recent low prices, ANZ noted, adding that this has led to a drop in copper inventories in China.

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Iron ore futures rose, likely boosted by China's economy growing 5.0% in the first quarter, accelerating from the 4.5% gain in the prior quarter. Meanwhile, higher diesel prices due to the Mideast conflict raise production and transportation costs, boosting iron ore prices, Galaxy Futures said.

TODAY'S TOP HEADLINES

China's Economy Starts Year on Strong Footing, but Iran Risks Loom

China reported accelerating economic growth to start the year, driven by robust exports, but shock waves from the Iran war threaten its momentum.

China's gross domestic product expanded 5% in the first quarter of 2026 compared with a year earlier, up from 4.5% growth in the fourth quarter of 2025, according to government data released Thursday.

Trump Aims to Force a Quick Iran Deal With a Slow Squeeze

Over a small, private dinner of spinach soup, scallops and Diet Coke on Monday night, President Trump told the Dutch king and queen that he wants to bring the war in Iran to a swift end.

The only way to get Tehran back to the negotiating table, Trump explained to his royal guests and Dutch officials at the White House dinner, was to increase the pressure, officials briefed on the dinner said.

Trump Turns Against Italy's Giorgia Meloni, Broadening Clash With Europe

ROME-As President Trump's rift with Europe widens, he is casting even his political friends into the chasm.

Italian Prime Minister Giorgia Meloni has spent the past year trying to act as a bridge while Trump tussled with other European leaders over tariffs, Ukraine and Greenland.

How the U.S. Is Uniting Libyan Rivals to Squeeze Out Russia

SIRTE, Libya-The twin-turboprop plane carved a line down through the sky and touched down at a desert airstrip here near Libya's Mediterranean coast. Out stepped a visitor whose arrival would have been unthinkable a decade ago.

Back then the airport at Ghardabiya was controlled by Islamic State. Later it was held by the Russian mercenary group Wagner.

Pentagon Approaches Automakers, Manufacturers to Boost Weapons Production

The Trump administration wants automakers and other American manufacturers to play a larger role in weapons production, reminiscent of a practice used during World War II.

Senior defense officials have held talks about producing weapons and other military supplies with the top executives of several companies, including Mary Barra, chief executive officer of General Motors and Jim Farley, CEO of Ford Motor, according to people familiar with the discussions.

Has the Era of the Mega-Layoff Arrived?

Snap is laying off 16% of its staff. Block lopped off 40% of its workforce. Oracle, meanwhile, is shedding thousands of employees, after Amazon cut about 30,000 in a matter of months.

Welcome to the era of the mega-layoff. In Silicon Valley and beyond, companies that are cutting staff are doing it with a big ax. Instead of laying off people in more incremental-and less disruptive-waves, employers are seizing on the potential financial upsides of severing swaths of their workforces at once.

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Expected Major Events for Thursday

04:30/NED: Mar Unemployment

06:00/UK: Feb UK trade

06:00/UK: Feb Index of production

06:00/UK: Feb Index of services

06:00/UK: Feb Monthly GDP estimates

06:30/SWI: Mar Import Price Index

06:30/SWI: Mar PPI

07:00/SVK: Mar Harmonized CPI

07:00/AUT: Mar CPI

08:00/ITA: Mar CPI

09:00/CRO: Mar CPI

09:00/CYP: Mar Harmonised CPI

09:00/EU: Mar Harmonised CPI

09:00/MLT: Mar Harmonised CPI

10:00/FRA: Feb OECD Harmonised Unemployment Rates

10:00/FRA: 4Q OECD Quarterly Labour Market Situation

11:30/UK: Mar NIESR Monthly GDP Tracker

23:01/UK: Mar Scottish Retail Sales Monitor

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This article is a text version of a Wall Street Journal newsletter published earlier today.

(END) Dow Jones Newswires

04-16-26 0015ET