The IBEX 35 opened higher on Wednesday after two consecutive positive sessions, lifted by a wave of well-received corporate earnings and signs of easing tensions between Washington and Tehran.
Also providing support was a reprieve from concerns over artificial intelligence that rattled markets last week, as traders closely monitor the progress of US-Iran talks.
Following Tuesday's negotiations in Geneva, Iran's Foreign Minister said that Tehran and Washington had reached an understanding on "guiding principles" to steer their historic nuclear dispute, easing fears of a conflict near the Strait of Hormuz that could disrupt global oil supplies.
On the corporate front, reports from Britain's BAE Systems, Swiss bank EFG, and French supermarket group Carrefour were met with a constructive tone by the market.
The improved sentiment was also aided by a perception of greater calm regarding risks linked to artificial intelligence—ranging from potential corporate over-investment to its impact on employment—following last week's setback.
"The AI-driven sell-off is cooling, bringing some calm back to the market," said Sergio Ávila, market analyst at IG.
At 0805 GMT on Wednesday, Spain's blue-chip IBEX 35 was up 119.20 points, or 0.66%, at 18,074.60 points, while the pan-European FTSE Eurofirst 300 index advanced 0.45%.
In the banking sector, Santander rose 1.67%, BBVA gained 0.56%, Caixabank advanced 1.56%, Sabadell added 0.97%, Bankinter increased by 1.03%, and Unicaja Banco was up 1.14%.
Among major non-financial stocks, Telefónica was up 0.11%, Inditex rose 0.14%, Iberdrola gained 0.40%, Cellnex advanced 0.66%, and oil company Repsol climbed 0.55%.
Standing out on the downside was Naturgy, which fell 2.42% after releasing earnings on Wednesday.
(Reporting by Tomás Cobos; editing by María Bayarri Cárdenas)
