European stocks extend gains as Iran sanctions worries ease
STOXX 50 and STOXX 600 extend gains around 0.6% as investors respond to a softer-than-feared US sanctions package against Iran, with oil lower and defense stocks leading.
European stocks extended their gains on Tuesday afternoon, with both the STOXX 50 and broader STOXX 600 up around 0.6%, as investors welcomed a softer-than-feared US sanctions package against Iran.
Oil prices fell further as markets saw limited immediate risks to global crude supplies, while defense stocks led sectoral gains, led by an over 8% jump in Melrose Industries after the GKN Aerospace owner said it expects to resume full production at its Garden Grove facility by September 28.
On the data front, German business morale reached a one-year high in August, while German GDP growth was revised up to 0.3% in Q2 2026 from a preliminary 0.2%, supported by stronger exports.
Attention now turns to Nvidia’s earnings later this week for further clues on the strength of AI-related demand.
Investors will also be watching Fed Chair Kevin Warsh’s debut speech at the Jackson Hole symposium for signals on the recent rise in bond yields and the central bank’s independence.