European Shares Set For Gap-up Open As US-Iran Tensions Ease

(RTTNews) - European stocks are seen opening on a strong note on Wednesday amid signs of de-escalation of tensions in the Middle East.

U.S. President Donald Trump said on Tuesday that the U.S. could end its Iran military campaign within 2-3 weeks, claiming that Washington had already achieved its core objectives of hobbling Iran's nuclear ambitions and bringing a regime change in the country.

Asserting that Tehran no longer possessed functional defense infrastructure, Trump claimed that the U.S. "will not have anything to do with" what happens next in the Strait of Hormuz" and that other nations can reopen the key shipping lane that supplies 20 percent of the world's oil consumption.

Countries that did not help the U.S. and Israel in attacking Iran could buy oil from the U.S. or "just take it" from Hormuz, Trump added.

"Let the countries that are using the strait, let them go and open it… because I would imagine whoever's controlling the oil will be very happy to open the strait."

Trump's remarks came after he told U.S. allies to "go get your own oil" and blamed them for refusing to be more involved in its war effort. The U.S. President will address the nation on Iran at 21:00 ET (23:00 GMT) later today.

While investors piled into equities in a euphoric relief rally, Brent crude prices rose above $105 a barrel, recouping losses from the previous session and extending a strong March rally as Strait of Hormuz disruption persists.

Even if the conflict ends within the indicated timeline, analysts say that infrastructure damage is likely to keep supply tight in the near term.

"The combination of limited tangible diplomatic progress, continued maritime attacks and explicit threats against energy assets keeps supply risks skewed to the upside," LSEG analysts said in a ?note.

Meanwhile, a third U.S. aircraft carrier strike group is en route to the Middle East, keeping markets cautious.

According to The Wall Street Journal, the United Arab Emirates has signaled willingness to join a U.S.-led coalition to forcibly reopen the strait.

Earlier today, Iran launched drone strikes targeting Kuwait International Airport, hitting fuel storage tanks and triggering a "large fire".

Bahrain reported a fire at a business facility "as a result of the Iranian aggression", while Saudi Arabia's defense ministry said several drones were intercepted and destroyed. In Qatar, a tanker was hit north of Doha.

Asian markets were sharply higher on renewed hopes that the Iran war could soon end. With bargain buyers stepping in, South Korea's Kospi surged over 8 percent and Japan's Nikkei added nearly 5 percent. Benchmark indexes in Hong Kong and Australia were up over 2 percent each.

Investors were also reacting to regional factory activity readings, with China's manufacturing activity expanding for a fourth straight month in March.

The dollar weakened and bond yields dipped while gold rose toward $4,700 an ounce with the easing of Middle East tensions.

U.S. stocks soared overnight, with all three major indexes posting their best showing of 2026, after President Trump signaled a potential shift in American policy on securing the Strait of Hormuz.

In economic releases, a measure of U.S. consumer confidence inched up again in March, while the JOLTS report for February suggested the labor market is continuing its gradual cooling.

The tech-heavy Nasdaq Composite jumped 3.8 percent, the S&P 500 spiked 2.9 percent and the Dow surged 2.5 percent after bruising losses in March.

European stocks rose on Tuesday but notched their worst monthly performance in six years on geopolitical and inflation fears.

The pan European Stoxx 600 gained 0.4 percent. The German DAX and the U.K.'s FTSE 100 both rose by half a percent while France's CAC 40 added 0.6 percent.