FX.co ★ European Stocks Close Sharply Higher

The Euro STOXX 50 rose 2% and the STOXX Europe 600 climbed 1.8% on Friday, supported by lower oil prices after Iran’s foreign ministry said it was close to reaching a deal with the United States. The comments bolstered confidence in a gradual recovery of energy exports from the Persian Gulf, following a bout of volatility earlier in the session triggered by conflicting remarks from US President Trump.

Sovereign bond yields declined, and banks benefited from the brighter credit outlook. Deutsche Bank jumped 6.6%, while Santander and BNP Paribas each gained more than 5%. Meanwhile, ASML advanced 3.4%, moving in line with strength across the AI infrastructure segment after SpaceX surged 15% in its IPO, boosting available capital for AI firms to invest in chips and data centers.

Separately, the European Central Bank raised interest rates yesterday for the first time in nearly three years and signaled that its restrictive policy stance could stay in place through 2027.