European shares closed higher on Tuesday amid an easing of concerns over geopolitical tensions in the Middle East.
The pan-European Stoxx 600 was provisionally 0.3% lower at the closing bell, with tech stocks up more than 1.3% while oil and gas stocks gave back 0.5%, having previously surged on the back of U.S.-Iran escalations.
Market focus is largely attuned to geopolitical developments following Washington’s targeted killing of Iran’s top military commander Qasem Soleimani in Iraq. Equity markets fell the past two sessions amid a flight to safety, but look to be changing course as Monday passed with no new escalation in tensions.
Confusion arose however as a letter surfaced showing U.S. plans to pull troops from Iraq, only to be followed by Defense Secretary Mark Esper labeling it “inconsistent” and stating “there has been no decision whatsoever to leave.”
Stocks on Wall Street were mixed on Tuesday amid the ongoing geopolitical tension.
Back in Europe, Spanish Socialist leader Pedro Sanchez on Tuesday narrowly secured parliamentary backing for his left-wing coalition government after almost a year of caretaker governments and political stalemate.
In terms of data, euro zone inflation picked up by 1.3% in December as expected, compared to 1.0% in November, but is expected to dip again at the start of 2020, according to Eurostat. Inflation remains well below the European Central Bank (ECB) target of close to, but below, 2%.
British luxury carmaker Aston Martin plunged more than 16% after issuing a profit warning on Tuesday morning.
French pharmaceutical company Ipsen climbed 5.8% after announcing a newly designed delivery system for its Somatuline Autogel, while Danish jeweler Pandora added a further 3.4% after Bank of America and Danske Bank raised their price targets for the stock.
At the other end of the European benchmark, NMC Health shares ended the session 10.6% lower after a torrid few weeks on the back of an attack by U.S. activist short-seller Muddy Waters.
Elsewhere, shares of UBS rose by 2.6% after it was reported that the lender would cut up to 500 private banking jobs as part of a business overhaul.
European shares closed higher on Tuesday amid an easing of concerns over geopolitical tensions in the Middle East.