Europe close: Stocks edge higher, buoyed by oil sector
Stocks finished on a slightly higher note, with Big Oil buoyed by the sharp run-up in crude oil futures after the US administration announced its decision overnight to walk out of the Iran nuclear accord.
"Whilst other signatories remain onboard, Trump’s decision potentially turns the geopolitical instability dial up a notch, especially in the Middle East, while also driving a wedge between US and its European allies, who were united in opposition to US withdrawal," said Michael van Dulken at Accendo Markets.
"That said, Trump has clarified that he is willing to revisit the situation, should a better deal be on the table."
Against that backdrop, by the close of trading, the benchmark Stoxx 600 was 0.63% or 2.44 points ahead to 392.44, alongside a 0.24% or 30.85 point rise to 12,943.06 for the German Dax and a gain of 0.23% or 12.70 points to 5,534.63 on the Cac-40.
In parallel, front month Brent crude oil futures on the ICE were jumping 2.956% to $77.11, which in turn had pushed the Stoxx 600's Oil&Gas gauge up by 2.64% or 8.99 points to 349.89.
Italian oil major Eni jumped 2.77% on the day, followed close behind by the likes of Total (1.89%) and Spain's Repsol (2.54%).
Going the other way, the same pan-European indice's Travel&Leisure sector gauge was down by 1.12% at 256.92.
For their part, analysts at Barclays Research were telling clients that: "the US policy announcement on 8 May stokes regional tensions and limits the medium-term prospects of Iranian oil supply.
"[...] In the medium term, a new US sanctions regime will surely threaten Iran’s ability to attract foreign investment, especially for Yadavaran and Azadegan, keeping the country’s output flat or lower through 2025."
On the economic front meanwhile, investors were sifting through mixed data on French and Spanish industrial production.
In France, INSEE reported a 0.4% month-on-month drop (consensus: 0.3%) in the country's industrial output on the back of steep declines in Mining and Construction.
Over in Spain on the other hand, production jumped by 1.2% on the month (consensus: -0.2%), according to INE.
For later in the session, investors were waiting on the release of a report on US wholesale prices for the month of April at 1330 BST.
Meanwhile, on the corporate side of things, shares of Vodafone got a lift on news that it had offered €18.4bn for a roughly one-third stake in Liberty Global in a push to increase its stake in Germany and Eastern Europe.
Also falling under the weight of selling pressure in the wake of the Iran deal news were specific companies with interests in the region, such as Airbus or Volkswagen.