European Stocks Swing as Investors Gauge Iran War De-Escalation

European stocks rebounded sharply after US President Trump postponed planned military strikes on Iran’s energy infrastructure, citing “very good” talks with Tehran. The abrupt reversal triggered one of the market’s largest intraday swings in years. The Stoxx Europe 600 index climbed 1% by midday Paris time, recovering from steep early losses as investors reassessed geopolitical risks. Markets reacted to de-escalation signals despite lingering uncertainty over US-Iran tensions. Iran’s semi-official Fars news denied any direct or indirect negotiations with Trump, attributing his retreat to Iranian threats. The conflicting narratives added volatility as traders weighed diplomatic progress against regional instability. Trump’s decision followed weeks of rising tensions, including sanctions and naval confrontations in the Persian Gulf. The postponement eased immediate fears of a broader conflict but left long-term risks unresolved. Analysts warned the volatility underscores how sensitive markets remain to Middle East flashpoints, with energy prices and supply chains vulnerable to sudden shifts in US-Iran relations.