Global Market: European shares pause after rally, doubts linger over Iran peace deal

European shares slipped on Wednesday, pausing after a strong finish to the second quarter and amid caution over signs that peace talks between Iran and the United States hit a new stalemate. The pan-European ‌STOXX 600 ⁠index slipped ⁠0.3% to 639.64 points by 0710 GMT after logging its strongest quarter since October 2020 in the previous session.

The technology sector, which had been a key driver over the past three months, was flat, with chip equipment maker ASML down 1.1% and IQE and Infineon trading marginally lower. Schneider Electric lost 2.1% after the AI equipment maker said it had signed an agreement ⁠to acquire ‌Cognite Holding, a privately held provider of AI software and industrial data for $3.1 billion in an all-cash deal.

Focus will be ⁠on the European Central Bank's Sintra conference, where U.S. Federal ​Reserve chair Kevin Warsh and ECB President Christine Lagarde ​are expected to speak later in the day. Traders anticipate both major central banks to lift interest rates by at least 25 basis points each later this year, LSEG-compiled data showed.


Oil prices have fallen back to pre-Iran war levels, however, concerns are that price pressures will linger for ‌some time. Among top movers, Primark owner Associated British Foods slipped 2.7% after saying it still expects annual profit to be below the prior year's outcome, ⁠adding that the Middle East conflict impacted its European profit outlook.

Swedish defence equipment maker Saab gained 1.7% after signing a contract to deliver 16 Gripen ​E fighter aircraft to Ukraine in a deal worth about 24.6 billion Swedish crowns ($2.54 billion). Elsewhere, Iran said it would not meet with top U.S. envoys who flew to the region following an outbreak of hostilities, clouding the prospects for a lasting peace between the two countries.