Volkswacht Bodensee - US stocks finish higher amid hopes for US-Iran deal as oil price gains moderate

Some analysts cited President Donald Trump's claim that Iranian representatives phoned him and expressed keen desire for a deal after weekend talks in Pakistan failed to yield an agreement.

Oil prices, which had surged back above $100 a barrel as the United States imposed a blockade on Iran's imports, later eased. Both major contracts ended higher but below $100 a barrel.

"The market is betting that Trump will get some sort of a deal," said Peter Cardillo of Spartan Capital Securities.

Trump warned Monday that any Iranian attack boats that approach the American naval blockade around Iran's ports would be destroyed, despite international calls for a ceasefire to be respected.

But markets also took in the US president's White House comments that Iranian representatives had called to make a deal since the Islamabad talks failed.

"I can tell you that we've been called by the other side. They'd like to make a deal. Very badly, very badly," he told reporters outside the Oval Office, without identifying which officials had called.

US indices picked up momentum after Trump's remark near midday, with the broad-based S&P 500 finishing up 1.0 percent.

The advance in stocks suggests "that the market remains confident that a potential end to the conflict could be imminent and that it will spur a sharp upward move across equities," said Briefing.com.

But the heightened risk of inflation and a global slowdown is expected to dominate this week's annual spring meetings of the International Monetary Fund and the World Bank in Washington.

On Friday, the US government reported that consumer-level inflation climbed to 3.3 percent in March, the highest since May last year.

"The stagflation word is being widely aired once again as geopolitical turmoil threatens to stymie international growth and stoke inflationary pressures," said Russ Mould, investment director at AJ Bell.

Asian and European markets ended the day mostly lower.

"Reopening the Strait of Hormuz remains the key requirement for reigniting a sustainable rally across risk assets," said David Morrison, an analyst at Trade Nation.

"Yet there's also a conviction, rightly or wrongly, that the war will end relatively soon," he said, noting that oil futures contracts for deliveries later this year are currently priced well below current market prices.

"As far as oil traders are concerned, this war may be in its seventh week, but it should be resolved by summer," Morrison said.

But Chancellor Friedrich Merz warned Monday that Germany, Europe's biggest economy, would feel the effects of the energy shock from the war "for a long time to come, even after it is over", as his government announced relief measures including a fuel-tax cut.

In Hungary, stocks rallied five percent after conservative Peter Magyar won a thumping majority in parliamentary elections Sunday, ousting Prime Minister Viktor Orban after 16 years in power and opening the way to improved relations with the European Union.

Economists at ING said that alongside economic reforms, Hungary's new pro-Europe government could set a target date for adopting the euro.

"If timed perfectly, this could boost market confidence and give the Tisza party more time to work on the Hungarian economy with some tailwinds," they wrote in a research note.

- Key figures at 2040 GMT -

Brent North Sea Crude: UP 4.4 percent at $99.36 a barrel

West Texas Intermediate: UP 2.6 percent at $99.08 a barrel

New York - Dow Jones: UP 0.6 percent at 48,218.25 (close)

New York - S&P 500: UP 1.0 percent at 6,886.24 (close)

New York - Nasdaq Composite: UP 1.2 percent at 23,183.74 (close)

London - FTSE 100: DOWN 0.2 percent at 10,582.96 (close)

Paris - CAC 40: DOWN 0.3 percent at 8,235.98 (close)

Frankfurt - DAX: DOWN 1.3 percent at 23,742.44 (close)

Tokyo - Nikkei 225: DOWN 0.7 percent at 56,502.77 (close)

Hong Kong - Hang Seng Index: DOWN 0.9 percent at 25,660.85 (close)

Shanghai - Composite: UP 0.1 percent at 3,988.56 (close)

Euro/dollar: UP at $1.1761 from $1.1723 on Friday

Pound/dollar: UP at $1.3507 from $1.3462

Dollar/yen: UP at 159.41 yen from 159.27 yen

Euro/pound: FLAT at 87.08 pence

burs-jmb/dw

P.Staeheli--VB