A financial trader uses a smartphone as she monitors data on her computer screens at the Frankfurt Stock Exchange. European stock markets climbed yesterday after Iran struck a landmark deal on its nuclear programme that will see sanctions eased on the key oil exporter.


AFP
Reuters

European stock markets climbed yesterday after Iran struck a landmark deal on its nuclear programme that will see sanctions eased on the key oil exporter.
The accord reached over the weekend in Geneva sent oil prices down, weighing on the share prices in energy groups but boosting airlines facing huge fuel costs.
London’s benchmark FTSE 100 index added 0.30% to 6,694.62 points, Frankfurt’s DAX 30 climbed 0.88% to a new record close of 9,299.95 points, while the CAC 40 in Paris rose 0.55% to 4,301.97 points.
“News that the US has struck a deal with Iran on its nuclear activities has seen... oil prices decline, and has to a degree lessened the risk premium normally associated with Middle-East tensions,” said Brenda Kelly, senior market strategist at IG traders.
“The fall-out has seen stocks for the major oil companies such as BP and Royal Dutch Shell take a tumble... (but) airlines have been clear beneficiaries of the pull-back in the oil price,” she added.
IAG, parent of British Airways and Iberia, rallied 2.8% to 372.8 pence and Easyjet climbed 2.1% to 1,434 pence. German carrier Lufthansa advanced 1.8% to 16.06 euros, and Air France-KLM added 1.9% to 7.64 euros.
BP fell 0.68% to 490.1 pence and Royal Dutch Shell ‘A’ shares lost 0.4% to 2,097 pence.
Shares in struggling French automaker PSA Peugeot Citroen jumped 5.1% to 10.75 euros on Iran and expectations that the group would hire a top executive from Renault, dealers said.
Peugeot cars are a ubiquitous presence on roads in Tehran and the prospective easing of economic sanctions could mean a boost for a company that is at pains to expand sales.
The Iran deal, a preliminary accord laying the foundation for a comprehensive agreement, was reached after marathon talks in Geneva between Iran and the so-called P5+1 nations comprising the US, China, France, Britain, Russia and Germany.
The euro rose to 0.8363 pence against the British pound, which fell to $1.6137.
On the London Bullion Market, the price of gold climbed to $1,243 an ounce from $1,225.55 on Friday.
“The interim nuclear agreement... has been welcomed initially by investors boosting investor risk sentiment further in the near-term,” said Lee Hardman, currency analyst at The Bank of Tokyo-Mitsubishi UFJ.
Under the deal, Tehran will limit uranium enrichment - the area that raises most suspicions over Iran’s nuclear programme – to low levels that can only be used for civilian energy purposes.
In return, it will get $7bn in sanctions relief.
Western countries accuse Iran of seeking to build a nuclear weapon, a charge Tehran has long denied.
US stocks pushed even higher yesterday as they reacted to the temporary deal with Iran.
In midday trade, the Dow Jones Industrial Average added 0.18% to 16,093.92 points.
The broad-based S&P 500 edged up 0.06% to 1,805.80 points, while the tech-rich Nasdaq Composite rose 0.13% to 3,996.77. The Nasdaq briefly broke though the 4,000 barrier for the first time in 13 years.