Europe midday: Shares hold gains on Iran peace talk hopes

(Sharecast News) - European shares rallied on Tuesday as investors punted on the US and Iran resuming peace talks as Washington started its blockade of the Strait of Hormuz. The pan-regional Stoxx 600 index was up 0.63% to 617 points at 1220 BST with all major bourses higher.

Iranian ports are now blockaded by the US military, further constricting the flow of oil through the vital waterway.

Oil prices also fell, with Brent crude down 0.36% to $99 a barrel and West Texas Intermediate declining 1.59% to $97.41 on reports that talks between the warring parties could resume in Islamabad as soon as this week.

In equity news, shares in LVMH fell as the luxury goods company on Monday said the conflict had cut at least 1 percentage point off global group sales, reflecting weaker spending in key hubs such as Dubai, and fewer wealthy shoppers travelling to Europe from the Middle East.

Peer Christian Dior also fell on the news.

Imperial Brands shares were down as the cigarette maker said the war could disrupt second-half performance. Rival British American Tobacco was also lower.

Givaudan jumped as the Swiss fragrance and flavour maker reported higher than expected first-quarter like-for-like sales growth.

Intertek surged as the testing and inspection specialist revealed it was mulling splitting into two businesses.

Reporting by Frank Prenesti for Sharecast.com