Volkswacht Bodensee - Oil strikes 4-year peak, stocks rise

International benchmark Brent crude soared more than seven percent to $126 a barrel, but then eased and turned lower.

Markets were jolted after President Donald Trump warned the US blockade of Iranian ports could last months, and by a report that he would be briefed on potential fresh military strikes.

"With no sign of any peace talks and fears mounting about an escalation, oil prices have continued their gains," said Jim Reid, managing director at Deutsche Bank, before oil prices peaked.

"Investors are pricing in a more protracted conflict," he added, with both sides at loggerheads over Iran's nuclear programme.

Trump is expected to receive a briefing on new plans for potential military action in Iran from Admiral Brad Cooper, the head of US Central Command, two sources with knowledge of the planning told news platform Axios.

As negotiations have stalled, the Islamic republic has maintained its stronghold over the strategic Strait of Hormuz, through which one-fifth of the world's oil usually passes.

Central banks remained a focus on Thursday, a day after the Federal Reserve kept interest rates unchanged as the United States faces elevated inflation triggered by the war.

The European Central Bank and Bank of England also both held rates steady.

But the ECB warned risks to the eurozone growth and inflation outlook have "intensified" because of the war in the Middle East and its impact on global energy supplies.

Meanwhile the Bank of England cut its forecast for UK growth.

Data released Thursday showed that growth in the eurozone economy slid to 0.1 percent in the first quarter. In the United States, it rebounded by a less-than-expected annual rate of two percent as consumer spending cooled and effects of the Middle East war began to ripple through the global economy.

Meanwhile the Federal Reserve's preferred inflation measure jumped 3.5 percent in March as energy costs surged on the back of the war.

Nevertheless, the US data "was another confidence booster in the notion that economic activity has remained resilient despite higher prices," said Briefing.com analyst Patrick O'Hare.

Wall Street's main stock indices opened higher, also buoyed by corporate results.

Shares in Google parent company Alphabet rose more than five percent as investors lauded the company's success in making the pivot to artificial intelligence and solid revenue across its major divisions.

But shares in Meta slumped more than nine percent amid concerns about its huge AI spending.

Overall, "the earnings results have been supportive, and understandably so given that there has been a large number of very large beats" of earnings forecasts, said O'Hare.

He noted that the latest results pushed the estimated average earnings increase from 15 to 26 percent.

"That is just massive, and it is the trajectory that has had the stock market looking confident in the face of the Middle East tumult and rising oil prices," said O'Hare.

In Europe, London and Frankfurt stock markets rose while Paris dipped.

Asian stock markets mostly fell, with Tokyo and Hong Kong both closing one percent lower. Shanghai gained.

The yen shot more than two percent higher against the dollar after Japan's finance minister hinted strongly that Tokyo was close to intervening in the market to support the currency, after it slipped to its lowest level against the dollar since mid-2024.

- Key figures at 1330 GMT -

Brent North Sea Crude: DOWN 3.7 percent to $113.72 a barrel

West Texas Intermediate: DOWN 2.5 percent at $104.23 a barrel

New York - Dow: UP 0.5 percent at 49,108.93 points

New York - S&P 500: UP 0.4 percent at 7,167.28

New York - Nasdaq Composite: UP 0.6 percent at 24,829.53

London - FTSE 100: UP 1.4 percent at 10,355.47

Paris - CAC 40: DOWN less than 0.1 percent at 8,067.68

Frankfurt - DAX: UP 0.8 percent at 24,140.59

Tokyo - Nikkei 225: DOWN 1.1 percent at 59,284.92 (close)

Hong Kong - Hang Seng Index: DOWN 1.3 percent at 25,776.53 (close)

Shanghai - Composite: UP 0.1 percent at 4,112.16 (close)

Euro/dollar: DOWN at $1.1688 from $1.1695 on Wednesday

Pound/dollar: UP at $1.3512 from $1.3489

Dollar/yen: DOWN at 156.69 yen from 160.23 yen

Euro/pound: DOWN at 86.53 pence from 86.71 pence

R.Buehler--VB