Europe midday: Shares slump, oil rises as Trump Iran pause fails to reassure

(Sharecast News) - European shares extended losses on Friday as traders took a dim view of US President Donald Trump's latest pause on attacking Iran's energy infrastructure. The pan-European Stoxx 600 index was down 1.12% to 574 at 1205 GMT. All major bourses fell, with Germany's DAX declining by 1.33%, Spain's Ibex 1.18%, France's CAC 40 0.84% and Italy's MIB 1%.

Oil prices remained elevated, with benchmark Brent crude jumping above $110 a barrel indicating that Trump's claim that ceasefire talks with Tehran were "going very well" wasn't resonating with the market.

Trump extended his deadline for Iran to open the strait of Hormuz by 10 days to April 6 April. Iran has denied Washington's insistence that it is "begging to make a deal", as the US president stated.

"Minutes after US stocks posted their worst day since the Middle East war, Trump was back on Truth Social extending his deadline for a peace deal. So far so Taco ... but markets ain't buying it with crude oil prices stubbornly higher and equity markets lower while the dollar and bond yields are elevated," said Saxo Markets analyst Neil Wilson.

"While this scales back the risk of immediate escalation, it does not indicate a clear path to resolution. Markets have largely shrugged it off with Brent back to $110, rising for a third day and European stock markets selling off again in early trade on Friday morning."

In equity news, shares in French spirits maker Pernod Ricard rose, having closed the previous session almost 6% lower, after it confirmed discussions on a possible merger with Jack Daniel's owner Brown-Forman.

Enagás surged after Spain's energy regulator proposed revenue reductions for the gas pipeline operator that were far smaller than feared.

Shares in Polish grocery chain Dino Polska fell sharply after the company's fourth-quarter earnings missed estimates.

Reporting by Frank Prenesti for Sharecast.com