European Stocks Close Broadly Higher Amid Signs Of Progress In U.S.-Iran Peace Talks

(RTTNews) - European stocks closed higher on Friday amid optimism about an end to the U.S.-Iran war thanks to negotiations between the two nations making "some progress."

U.S. Secretary of State Marco Rubio said there have been "some good signs" but cautioned he doesn't want to be "overly optimistic" and noted President Donald Trump has been clear he has "other options" if the U.S. and Iran can't get a "good deal."

One of the sticking points seems to be Iran's efforts to establish a tolling system for the Strait of Hormuz, which Rubio called "unacceptable" and said "would make a diplomatic deal unfeasible."

Rubio's comments come as reports from Iranian state media suggest the latest U.S. peace proposal has narrowed some of the gaps between the two countries.

Despite signs of progress, both sides are still at odds over Tehran's uranium stockpile and future control of the Strait of Hormuz.

Investors also digested a slew of regional economic data and some corporate news. Data showing an improvement in German consumer sentiment and a slightly faster pace of economic growth aided sentiment.

The pan European Stoxx 600 climbed 0.73%. The UK's FTSE 100 gained 0.22%, Germany's DAX jumped 1.15% and France's CAC 40 closed 0.37% up. Switzerland's SMI finished with a gain of 0.42%.

Among other markets in Europe, Austria, Belgium, Denmark, Finland, Greece, Iceland, Ireland, Netherlands, Poland, Sweden and Türkiye closed higher.

Czech Republic, Norway, Portugal and Russia ended weak, while Spain closed flat.

In the UK market, Games Workshop soared nearly 8%. The miniature wargames maker forecast annual profit before tax above expectations.

Rightmove surged 7.25%. Croda International climbed 4.3%, while Metlen Energy & Metals, Rolls-Royce Holdings, Persimmon, 3i Group, Melrose Industries, Diploma, BT Group, Polar Capital Technology Trust, Airtel Africa, BAE Systems and British Land gained 2%-4%.

British IT reseller Softcat soared nearly 13% after raising its full-year profit guidance.

Convatec Group dropped 3.2%. BP, Experian, Lion Finance, Fresnillo, Sainsbury (J), Endeavour Mining, Compass Group, The Sage Group, Prudential, Reckitt Benckiser, Shell, Imperial Brands and Marks & Spencer lost 1%-2.5%.

In the German market, Infineon surged about 8%. Deutsche Post moved up by more than 4%. Adidas moved up sharply after Deckers Outdoor forecast annual sales and profit above Wall Street estimates.

Symrise, MTU Aero Engines, Scout24, Rheinmetall, Continental, Merck, Siemens, Porsche Automobil Holding, Volkswagen, Heidelberg Materials, Commerzbank and Siemens Energy also posted strong gains.

Vonovia drifted down more than 5%. Fresenius Medical Care shed nearly 4% and Fresenius eased by 2.8%. E.ON, Munich RE and Bayer also ended notably lower.

In the French market, STMicroelectronics climbed nearly 5%. ArcelorMittal moved up 4.1% and Stellantis gained 3%.

Airbus, Safran, Accor, Schneider Electric, Dassault Systemes, Saint-Gobain, Renauls, Legrand, Thales and Michelin gained 1%-2.2%.

TotalEnergies, Danone, Teleperformance, EssilorLuxottica, Vinci, Carrefour and Kering lost 1%-2%.

In economic news, German consumer sentiment is set to improve in June driven by rising income expectations and willingness to buy but the war in the Middle East continues to cloud the outlook, latest results of the NIM Consumer Climate powered by GfK showed.

The consumer confidence index rose unexpectedly to -29.8 points in June from -33.1 points in May. The score was expected to fall to -33.7.

Despite an improvement in the economic expectations index, the majority of consumers still expect the economic situation to deteriorate over the coming twelve months. The economic expectations index climbed to -11.2 in May from -13.7 in the prior month.

Consumers expect prices to rise over the coming twelve months but the indicator dropped 5.4 points to -0.4 in May. The decline reflects the reduction in the energy tax on diesel and gasoline.

Data from Destatis showed the German economy expanded at a slightly faster pace in the first quarter, as previously estimated. Gross domestic product grew 0.3% from a quarter ago, unrevised from the previous estimate and followed fourth quarter's 0.2% expansion.

On a yearly basis, GDP registered a calendar-adjusted growth of 0.4%, which was slightly faster than the initial estimate of 0.3%.

At the same time, the statistical office confirmed that price-adjusted GDP logged a steady annual growth of 0.5% in the first quarter.

Data from statistical office INSEE showed France's manufacturing business climate index rose to 102 in May 2026, compared with expectations and April's 100. It also marked the highest reading in four months.

A separate data from INSEE showed France's overall business climate remained at 94 in May, unchanged from April as expected, and still well below its long-term average of 100.

UK retail sales declined at the fastest pace in nearly a year in April as consumers reduced fuel purchases after the outbreak of the conflict in the Middle East.

Retail sales declined 1.3% on a monthly basis in April, in contrast to the revised 0.6% rise in March, the Office for National Statistics reporte. This was the biggest fall since May 2025 and exceeded economists' forecast of a 0.6% drop.

On a yearly basis, retail sales unexpectedly remained flat after rising 1.4 percent in March. Economists were expecting an annual growth of 1.3 percent.

The UK consumer sentiment index rose two points to -23 in May on improving perceptions of both personal finances and their wider economy, a survey published jointly by GfK and the Nuremberg Institute for Market Decisions showed.

The index measuring changes in personal finances over the last twelve months increased four points to -7 and the forecast for personal finances gained two points to -2. Assessment about past general economic situation climbed four points to -47 and their expectations moved up five points to -38.