European stocks climbed to their highest levels since March 2 on Monday as talks between the United States and Iran showed signs of progress. The pan-European Stoxx 600 rose more than 0.8% shortly after 1:30 p.m. London time. France's CAC 40 gained 1.8% and Germany's DAX added 1.6%.
According to a report by CNBC, the gains came as hopes for a deal rose over the weekend. The moves extend what is now a five-day winning streak for European equities, following a rally on Friday. Trading volumes were thinner than usual with the U.K.'s FTSE 100 closed for a public holiday.
European stocks tracked Asian markets higher. Japan's Nikkei 225 crossed 65,000 for the first time on Monday, setting a record high. The move came in holiday-thinned trading after reports suggested the Strait of Hormuz, a critical global oil shipping lane, could reopen soon.
President Donald Trump posted on Truth Social that negotiations with Iran were "proceeding in an orderly and constructive manner," adding that he had told his representatives "not to rush into a deal in that time is on [their] side." Oil prices dropped more than 5% after his comments, relieving pressure on investors.
Iran's top negotiators traveled to Qatar over the weekend as part of intensified diplomatic efforts to reach an agreement, the Financial Times reported. The Strait of Hormuz sits at the entrance to the Persian Gulf and carries a significant share of the world's oil supply. Any movement toward its reopening carries major implications for global energy markets.
Eurozone bond yields also fell Monday. German 2-year Bund yields, which are more sensitive to interest rate expectations, dropped more than 9 basis points to 2.546%, their lowest level since May 8. Traders scaled back expectations for central bank rate hikes as inflation concerns eased with falling oil prices.
The geopolitical backdrop behind the market moves dates back more than two months. The U.S. and Israel launched a joint military operation against Iran, pushing oil prices higher and weighing on global investor sentiment. European stocks have been recovering since that period, and Monday's session pushed them back to levels last seen just before that offensive began.
In corporate news, shares in German food delivery company Delivery Hero surged more than 10% Monday afternoon. The move followed a Financial Times report that U.S. rival Uber had weighed an improved takeover bid. Delivery Hero confirmed on Saturday that it had received an offer from Uber of €33 ($38.29) per share, which would value the company's market capitalization at over €10 billion. The German company said it "remains fully focused on executing its strategic review process and further updates will be provided as required or appropriate."
