24th Jun 2025 12:05
(Alliance News) - European stocks traded higher on Tuesday, on hope of an easing in geopolitical tensions, though there some uncertainty on the status of a ceasefire.
The FTSE 100 index traded up 26.65 points, 0.3%, at 8,784.69. The FTSE 250 rose 188.22 points, 0.9% at 21,309.17, and the AIM All-Share was up 2.74 points, 0.4%, at 762.03.
The Cboe UK 100 was up 0.3% at 875.64, the Cboe UK 250 was 0.8% higher at 18,830.28, and the Cboe Small Companies rose 0.4% at 17,288.82.
In Frankfurt, the DAX 40 jumped 1.9%. The CAC 40 in Paris was 1.2% higher.
A barrel of Brent tumbled to USD69.32 on Tuesday afternoon, from USD76.39 at the time of the London equities close on Monday. Gold fell to USD3,327.00 an ounce from USD3,387.65.
Sterling rose to USD1.3604 from USD1.3501, the euro bought USD1.1596, up from USD1.1545 and against the yen, the dollar fell to JPY145.02 from JPY146.37.
Societe Generale analyst Kit Juckes commented: "Major currencies are set to resume their grind higher against a drifting USD until fresh geopolitical concerns appear. Crude prices and the Dollar Index are back to where they were almost two weeks ago, when our main concern, as we prepared to publish updated FX forecasts, was that the dollar could slip slowly lower, even in the absence of a convincing catalyst. Do we now face a resumption of this slow but steady decline, regardless of what is happening in the global economy?"
The fledgling ceasefire between Iran and Israel appeared in jeopardy. Both Middle Eastern countries had agreed to lay down arms, following a proposal by US President Donald Trump.
But on Tuesday morning, only hours after Israel agreed to the ceasefire, its Defence Minister Israel Katz claimed Iran had "completely violated" the agreement by launching missile strikes after it came into effect.
The defence minister instructed Israeli forces to resume targeting Iranian paramilitary and government targets.
Iran denied it launched missiles at Israel. The general staff of the Iranian army "denied the launch of missiles from Iran to the occupied territories [Israel] in the last few hours", state television reported.
Further, Iran accused Israel of launching three waves of attacks on sites in Iranian territory.
Nonetheless, airline shares rose, with easyJet the best of the bunch up 6.3%. BP was the worst FTSE 100 performer, down 4.2%.
XTB analyst Kathleen Brooks commented: "This is still a very fluid situation. The IDF announced this morning that missiles were fired into Israel from Iran."
XTB analyst Brooks noted market volatility "never really surged" on the back of the conflict.
"The market had a far stronger reaction to US trade tariffs than to geopolitical risk, which highlights that economic concerns are more worrying for stock markets than geopolitical issues, at this stage," Brooks added.
"The question now is, what will the market focus on next? With geopolitical risks expected to moderate from here, the focus could shift to Q2 earnings season that will start in a few weeks, and US trade tariffs. If we assume that tariffs will be sewn up in the coming weeks, then the focus could shift to the AI trade and a cruisy summer for volatility."
The yield on the 10-year US Treasury widened to 4.34% early Tuesday afternoon UK time, from 4.31% at the time of the closing bell on the London Stock Exchange on Monday. The 30-year yield stretched to 4.89% from 4.84%.
Stocks in New York are called higher. The Dow Jones Industrial Average is called up 0.7%, the S&P 500 up 0.8% and the Dow Jones Industrial Average 1.0% higher.
US President Trump once again attacked Jerome Powell to demand that he cut the country's interest rates, as the head of the Federal Reserve is expected to appear in front of Congress.
The Republican leader regularly berates Powell over the bank's decision not to lower interest rates, escalating his attacks after the Fed held steady for a fourth consecutive meeting last week.
Powell is due Tuesday to head to Capitol Hill to present the Fed's semi-annual monetary policy report to Congress' House Financial Services Committee – sparking another missive from Trump.
"Too Late' Jerome Powell, of the Fed, will be in Congress today in order to explain, among other things, why he is refusing to lower the Rate," Trump wrote on his Truth Social platform.
In the UK, Bank of England interest rate-setter Megan Greene has cautioned that recent rises in inflation could prove longer-lasting than forecast, leaving policymakers in an "uncomfortable place".
In a speech at the National Institute of Economic & Social Research, Monetary Policy Committee member Megan Greene said that stubborn inflation of around 3.5% for the rest of the year could keep fuelling wage rises and price hikes in the UK.
She said food prices have "surprised consistently to the upside", adding that the Israel-Iran conflict could also push up inflation by putting pressure on oil prices.
"I worry about the near-term profile for inflation this year, which in my view now resembles more of a 'plateau' than a 'hump'," she said.
Greene was one of a majority of MPC members who voted last week to keep rates on hold at 4.25%.
In London, Bunzl rose 1.4%. It said trading is in line with expectations, and predicted an improved second half performance, despite an "uncertain" backdrop.
The London-based distribution and outsourcing company said group revenue is expected to be 4% higher in the six months to June 30 than the prior year, at constant exchange rates, and up to 1% higher at actual exchange rates.
Bunzl expects operating margin over the period to be in-line with previously published guidance at around 7.0%, with the expected group adjusted operating profit decline also in-line with expectations.
In the first half of 2024, its operating margin was 8.0% and adjusted operating profit totalled GBP455.5 million.
For the full-year, "moderate" revenue growth is expected at constant currency. Its operating margin is forecast to be "moderately below" 8.0%, compared to 8.3% in 2024.
Cavendish rose 7.9%. The investment bank confirmed it has received interest in its private M&A and debt advisory business. It said this was "rejected and there have been no further discussions".
"The group's strategy is to focus on growing and evolving as a full service, fully integrated, small and mid-cap investment bank with the potential for adding additional business offerings rather than reducing them. Cavendish has already generated significant revenues and won a number of live mandates as a result of the integrated business offerings within the group," Cavendish added.
Still to come on Tuesday is a US consumer confidence reading at 1500 BST.
By Eric Cunha, Alliance News news editor
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