LONDON: Oil prices fell on Thursday and the US dollar weakened as investors monitored Pakistan-led diplomatic efforts to end the conflict involving the United States, Israel and Iran, while global stock markets delivered a mixed performance.
Investor sentiment was influenced by signs of continued diplomatic engagement between Washington and Tehran, although uncertainty over the conflict kept markets cautious.
Brent North Sea crude dropped 2.6 percent to $95.28 a barrel, while US benchmark West Texas Intermediate fell 3.1 percent to $93.06.
On Wednesday, US President Donald Trump expressed optimism that negotiations aimed at ending the war with Iran could produce results soon.
Speaking at the White House, Trump said a breakthrough was possible in the coming days. “It could happen … over the weekend,” he told reporters.
“I hear the negotiation itself is going very well, actually,” Trump said, referring to the ongoing diplomatic efforts to end the war in the Middle East, which began on February 28.
Iranian Foreign Minister Abbas Araghchi also indicated that communication channels between Tehran and Washington remained open despite limited progress.
“Communications with the Americans have not been cut off, and messages have been exchanged regarding the need to stop aggression against Beirut, but no tangible progress has been made in the negotiation process,” Iran’s Tasnim news agency quoted Araghchi as telling Lebanon’s Al Mayadeen television channel.
On Wednesday, Israel and Lebanon agreed to a ceasefire following two days of direct talks in Washington.
According to a joint statement, the agreement requires a “complete cessation” of fire by Hezbollah.
The two sides also agreed, “with the guidance of the United States”, to establish pilot zones where the Lebanese armed forces would assume exclusive control.
The statement said Lebanese forces would exercise authority in those areas “to the exclusion of all non-state actors”, an apparent reference to Hezbollah.
Global stock markets and technology sector
Financial markets were also affected by developments in the technology sector.
US Chipmaker Broadcom issued a forecast that disappointed investors, raising fresh concerns about the sustainability of valuations linked to artificial intelligence.
Broadcom shares plunged around 15 percent.
John Plassard of Cite Gestion said the decline was “reviving doubts” about the pace of growth in the artificial intelligence sector.
Technology stocks have been a major driver of global equity gains in recent months and have helped push several benchmark indexes to record highs.
European stock markets were mixed. Paris gained 1.0 percent and Frankfurt rose 0.6 percent, while London’s FTSE 100 slipped 0.1 percent.
On Wall Street, the Dow Jones Industrial Average rose 1.2 percent. The broader S&P 500 fell 0.2 percent, while the technology-heavy Nasdaq declined 0.9 percent.
In Asia, Japan’s Nikkei 225 lost 1.4 percent. Hong Kong’s Hang Seng Index fell 1.5 percent and Shanghai’s Composite Index dropped 0.6 percent.
In currency markets, the euro rose to $1.1639 from $1.1599 late Wednesday. Sterling strengthened to $1.3453 from $1.3420, while the dollar slipped to 159.87 yen from 160.07 yen.
