More than halfway through a two-week ceasefire, a senior Iranian official reports that significant disagreements between the U.S. and Iran persist. However, a visit by Pakistani Army Chief Asim Munir to Tehran has reportedly helped narrow differences in certain areas. It remains unclear if and when a second round of negotiations between the U.S. and Iran will take place. Pakistan hosted the initial peace talks last weekend, which ultimately collapsed.
Investors are now hoping for an extension of the ceasefire and a lasting peace, said Thomas Altmann of QC Partners. Yet even a peace agreement would not mean an immediate return to pre-war status, the expert warned. "Disrupted supply chains, damaged or shuttered production facilities, and high energy costs will continue to weigh on the outlook for a long time."
WHEN WILL THE STRAIT OF HORMUZ REOPEN?
The war in the Middle East has led to the largest disruption of global oil and natural gas supplies to date, causing energy prices to surge. The primary focus is on the Strait of Hormuz, a waterway through which approximately 20 percent of the world's oil and liquefied natural gas exports pass. Shipping is currently blocked by Iran, leaving hundreds of tankers and other vessels stranded in the Gulf. Following the failed peace talks, the U.S. also imposed a blockade on oil tankers leaving Iranian ports. On Thursday, Brent North Sea crude and U.S. WTI rose by nearly two percent at their peak, reaching 96.85 and 93 dollars per barrel, respectively. Reports that Iran is considering a partial reopening of the Strait of Hormuz, according to insiders, failed to move investors. "While there are hopes for de-escalation, many investors remain skeptical, as talks between the U.S. and Iran have repeatedly failed, even after appearing to make progress," said Toshitaka Tazawa, an analyst at Fujitomi Securities.
The tense situation in the Middle East also left its mark on industrial metals. Anticipating a significant supply deficit, the price of aluminum rose to 3,672 dollars per ton, its highest level since March 2022. The price has surged by nearly 17 percent since the start of the war in late February. Several local aluminum smelters in the Middle East have had to reduce production or have been damaged by attacks. Last year, the Gulf region supplied around nine percent of global aluminum demand.
GERRESHEIMER SHARES IGNITE
On the corporate front, Zalando shares outperformed in the Dax with a gain of more than three percent. In the mid-cap MDax index, shares of online pharmacy Redcare Pharmacy rose by as much as 8.9 percent. Swiss online pharmacy DocMorris boosted sector sentiment following a significant increase in first-quarter revenue, with its shares gaining 9.4 percent.
In the small-cap SDax index, Gerresheimer shares ignited a rally, gaining up to 20.8 percent. The embattled packaging group has been granted more time by its banks and promissory note creditors to resolve its accounting issues. Conversely, Heidelberger Druck shares slid by more than nine percent following their recent rally. The printing press manufacturer missed its earnings target for the 2025/26 fiscal year.
On the London Stock Exchange, EasyJet lost ground, with shares falling as much as 8.7 percent at one point. The British low-cost carrier expects a significantly higher loss due to the sharp rise in fuel costs resulting from the Middle East conflict.
(Report by: Daniela Pegna, edited by Christian Götz. For inquiries, please contact our editorial team at berlin.newsroom@thomsonreuters.com (for politics and economics) or frankfurt.newsroom@thomsonreuters.com (for companies and markets).)
