Europe midday: Shares mixed on stalled US-Iran talks; EZ inflation falls

(Sharecast News) - European bourses were mixed on Wednesday as investors took profits after wrapping the strongest calendar quarter since October 2020 and assessed a sharp fall in eurozone inflation.

The pan-regional Stoxx 600 index dipped 0.3% to 639.64 at 1150 BST points in morning trading, hovering just below the all-time record highs achieved during the previous session's late rally. Germany's DAX made strong gains, while the UK's FTSE 100, Italy's MIB and France's CAC 40 were all lower.

Stalled diplomatic progress between the US and Iran on ending their war weighed on sentiment. Hopes for an enduring ceasefire had initially sparked a relief rally across the continent, but a fresh deadlock in the Doha-mediated peace talks revived fears of potential volatility around control of the vital Strait of Hormuz.

US special envoy Steve Witkoff and President Donald Trump's son-in-law ‌Jared Kushner arrived in the Qatar capital of Doha to discuss US-Iran negotiations with mediators but would not meet Iranian officials, according to Qatar's foreign ministry.

The talks came after both sides exchanged fire over the disputed Strait of Hormuz waterway, despite a memorandum of understanding in place to find a path towards meaningful peace negotiations.

Meanwhile, eurozone inflation dropped sharply to 2.8% in June 2026, falling from 3.2% in May and coming in below the market consensus estimate of 3.0%.

It was the first major deceleration in consumer prices since January, driven by a significant slowdown in energy costs, which fell to an 8.7% annual growth rate from 10.8% in May after renewed diplomatic progress and ceasefire discussions between the US and Iran eased global oil supply anxieties.

Core inflation-which strips out volatile energy, food, alcohol, and tobacco prices-eased to 2.4% from 2.6%, signaling that underlying price pressures were starting to moderate.

In equity news, Galderma shares fell after the Swiss skincare specialist failed to get US regulatory approval for its latest product to rival AbbVie's Botox.

Aerospace and defense stocks made gains, with Sweden's Saab and Germany's Rheinmetall up on updated European manufacturing surveys and heightened tensions in the Gulf.

Reporting by Frank Prenesti for Sharecast.com