European Equities Surge as Strait of Hormuz Reopens, Oil Prices Plunge

European stock markets closed significantly higher on Friday, driven by the restoration of commercial shipping through the Strait of Hormuz. The announcement follows a 10-day ceasefire between Israel and Lebanon, easing critical geopolitical tensions in the Middle East and reducing the risk of supply chain disruptions. U.S. President Donald Trump confirmed via Truth Social that the strait is "completely open and ready for business," although he clarified that the U.S. will maintain its blockade of Iranian ports until a final peace agreement is formalized. This shift in geopolitical risk provided an immediate catalyst for risk-on sentiment across global markets. The impact on commodities was immediate, with oil prices tanking 14%. This collapse helped ease broader concerns regarding inflation and economic growth, fueling a rally in equities. The pan-European Stoxx 600 climbed 1.56%, while Germany's DAX surged 2.27% and France's CAC 40 rose nearly 2%. Sector performance was starkly divided. Energy giants BP, Shell, and TotalEnergies saw their shares tumble by 7.3%, 5.6%, and 5.2% respectively, tracking the decline in crude prices. Conversely, technology and industrial firms saw strong gains, with Infineon jumping over 6% and STMicroelectronics climbing 7.5%. Corporate news also played a role in specific movements. Alstom shares plummeted 30% after the company withdrew its medium-term forecast. In the food delivery space, Delivery Hero shares rose following news that Uber agreed to acquire an additional 4.5% stake in the business. On the macro front, Eurostat reported that Eurozone exports fell 6.7% year-on-year in February. Despite this, the trade balance showed a substantial improvement, posting a surplus of EUR 11.5 billion compared to a deficit in January.