Stocks and Bonds Surge as Axios Reports US-Iran Deal Nearing Resolution
Market Reactions to US-Iran Deal Developments
Stock Market Performance
LONDON, May 6 (Reuters) - Stocks and bonds jumped and the U.S. dollar dipped on Wednesday, after a report from Axios stated the U.S. and Iran are closing in on one-page memo to end the war, which sent the oil price tumbling.
Europe's broad STOXX 600 jumped sharply and was last up 2.2% on the day, with energy- and economy-exposed stocks like banks and miners to the fore, while oil and gas stocks fell.
Key Details from Axios Report
The U.S. expects Iranian responses on several key points in the next 48 hours according to the report, which cautioned that nothing has been agreed yet but said this was the closest the parties had been to an agreement since the war began.
Reuters could not immediately verify the report.
Bond Market Movements
US Treasury Yields
Bonds also rallied, pushing yields on benchmark U.S. 10 year Treasury notes down 6 basis points to 4.35%.
European Bond Performance
European bonds, which have suffered more in recent weeks, outperformed. German 10-year yields were down 7.5 bps at 2.99% and rate-sensitive two-year yields fell 10 bps to 2.658% as markets scaled back bets on the amount of rate hikes they expect from the European Central Bank this year .
British and Italian Yields
British and Italian yields fell more sharply, down 10 bps and 12.5 bps on the day, respectively.
Currency Market Response
The dollar also slid, with the euro and pound both up 0.6% at $1.1762, and $1.3618.
(Reporting by the Europe markets team; writing by Alun John; Editing by Amanda Cooper)
