Donald Trump's words dye stock markets red: oil continues to surge

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Benedetta Zimone

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Donald Trump's words weigh on the markets once again. The main European indices fell sharply following the speech of the President of the United States, delivered during the night around 3 a.m. (European time). Once again, the tycoon did not provide any reassuring statements about the progress of the conflict, instead reverting to threatening tones toward the adversary, thereby fueling uncertainty among investors.


European indices performance


In the session under consideration, the main European indices recorded widespread negative performance, reflecting a climate of caution among investors. Specifically, the CAC 40 fell by 0.88%, while the FTSE MIB registered a more pronounced decline of 0.95%, highlighting relative weakness in the Italian market. The FTSE 100 showed a smaller drop of 0.13%, demonstrating relative resilience compared to other indices. In Germany, the DAX suffered the most significant loss (-1.38%), signaling potential pressure on industrial stocks, while Spain's IBEX 35 fell by 0.99%. Finally, the STOXX Europe 600, which represents a broad European basket, declined by 0.92%, confirming a general downward trend across the continent’s markets.


Trump's statements


“The war will end in two or three weeks,” said the White House resident, leaving investors skeptical, as this phrase has been repeated multiple times without concrete results. He also warned, “We will hit Tehran hard and bring it back to the Stone Age,” which caused oil prices to surge. Furthermore, threatening remarks about potential attacks on energy facilities did little to calm the markets.


The oil rally


As a result, West Texas Intermediate crude immediately jumped by about 6%, reaching $106 per barrel, while Brent crude registered an even stronger increase of 6.5%, climbing to $107.78 per barrel. This sharp rise in oil prices benefited energy sector stocks, which tend to react directly to rising commodity prices.


Among European energy companies, Eni stood out with a gain of 3.76%. The British Shell also performed well, up 3.01%, while the French TotalEnergies rose by 2.36%. Overall, the energy sector remains one of the most reactive during geopolitical tensions, where oil supply is uncertain and prices tend to rise rapidly.