The market movement is primarily explained by the rapid evaporation of a major geopolitical risk premium. The closure of the Strait of Hormuz had revived the specter of a global energy shock, with immediate repercussions for oil prices, inflation, and growth expectations. Its reopening, following the fifteen-day ceasefire with Iran, has mechanically triggered a reversal: a move toward normalization.

There is no need to recount the history of the Strait of Hormuz's importance; the web, newspapers, and social media are saturated with experts who have explained it from every conceivable angle. The upheaval following the fifteen-day truce agreed upon last night between Washington and Tehran is directly reflected in sectoral performance.

Tourism: An obvious play

Airlines and tourism stocks are among the primary beneficiaries. Since their business models are heavily dependent on fuel costs, the expected easing of oil prices translates into an immediate improvement in margin outlooks. Added to this is the return of better visibility regarding international flows, which supports demand expectations. In morning trading, Air France-KLM is up 14%, tour operator TUI AG has gained 11%, and Accor is up 8%. It is a logical trend that the market clearly understands.

Cyclical industry at large

Cyclical industrial stocks are also advancing. They had been penalized by the prospect of an energy shock capable of weighing on global activity. The reduction in recession risk and the stabilization of energy costs allow the market to price back in a more orderly growth scenario, favoring players exposed to investment and production. In the construction sector, Saint-Gobain, Buzzi, and Heidelberg Materials are gaining 9% or more. In the automotive sector, Volvo Cars, Continental, Renault, and Stellantis are up over 7%. Also noteworthy is the stellar performance of engine manufacturers Safran (+11%) and Rolls-Royce (+9%), which benefit both from the cyclicality of industrial activity and the improved fortunes of airlines.

Banking sensitive to normalization

The banking sector is also capitalizing on this movement. The disappearance of a tail risk reduces fears related to a rapid deterioration in credit quality and generalized financial stress. Investors are downwardly revising the probability of a crisis scenario, which supports sectoral valuations. Institutions with exposure to market activities are riding the wave (Société Générale +9%, Commerzbank +9%, Barclays +8%). Highly leveraged players, such as Greek banks Piraeus Bank and Eurobank, are benefiting even more with gains exceeding 15%.

Tech and commodities in fine form

In industrial technology and semiconductors, the logic is similar. The normalization of energy and logistics conditions restores visibility for supply chains and capital expenditure. The market anticipates a less constrained environment for industrial activity. Soitec (aided by a Jefferies note) is up 10%, Infineon 9%, and Schneider 8%.

Finally, commodity-linked stocks are benefiting from a more indirect effect. They had suffered from rising recession fears. The receding of these concerns favors a repositioning into cyclical assets sensitive to global demand. This includes steelmakers (Salzgitter +19%, ArcelorMittal +11%...), industrial miners (Antofagasta +12%, Anglo American +10%), and even gold and silver miners (Fresnillo +9%).

Oil and fertilizers under heavy pressure

On the downside, the sacrificial lambs are easy to identify: woe to the energy companies, with Maurel (-13%), Equinor (-12%), BP Plc, and TotalEnergies (-6%). The drop in crude prices will eat into their future bumper profits. Also featured are several fertilizer players (K+S and Yara losing over 10%), as they had been benefiting from shortages that guaranteed opulent margins. Defensive plays (Orange, -1.5% or RWE, -1.5%) are missing out on the rebound but limiting their losses: investors know that the feast may not last forever.