European stocks rise, oil prices fall on hopes for US-Iran talks

European stock indexes rose and oil prices fell on Wednesday, after markets got a ​boost from reports that the U.S. is seeking a month-long ceasefire with Iran, even though Iran rejected the idea ‌of negotiations, Reuters reported.

U.S. President Donald Trump told reporters on Tuesday that the U.S. was making progress in negotiating an end to the war, raising hopes that oil could start being exported from the Gulf again.

Traders were cheered by reports of the ceasefire proposal and that the U.S. had sent Iran a 15-point plan for discussion. Iran, however, denied ​direct talks and an Iranian military spokesman said the U.S. is negotiating with itself, according to state media.

Still, markets took a positive ​turn, making modest gains during Asian and European trading hours.

European stock indexes rose, with the STOXX 600 up 1.2% ⁠on the day at 1236 GMT - a rebound which did little to counter its overall decline so far in March, leaving it down ​7.5% on the month.

London's FTSE 100 was up 1.1% on the day (.FTSE), opens new tab.

Wall Street was set to open higher, with S&P 500 e-minis up 0.8% on the ​day .

"The mood is on the positive side," said Amelie Derambure, senior multi-asset manager at Amundi. "(The) market is trading now the idea that peace talks or a ceasefire could be on the way."

Derambure said traders were positioning themselves to avoid missing out on a possible "relief rally", when markets rise on positive news, although she added ​that more convincing news will be needed for the move to be sustained.

OIL EASES, BOND YIELDS FALL

Oil prices, which have risen sharply since the U.S.-Israeli war on Iran began, eased slightly, with Brent crude futures down 4.1% at $100.25 a barrel, and U.S. West Texas Intermediate crude futures down 3.7% at $88.91 a barrel.

Iran has said that "non-hostile vessels" may cross ​the Strait of Hormuz if they ​coordinate with Iranian authorities, but ⁠the waterway, which typically carries about one-fifth of the world's gas and crude supply, remains effectively closed.

European government bond yields fell, in a move led by Italian bonds, which had been particularly hard hit since the war started due ​to Italy's dependence on fossil fuel imports.

The benchmark 10-year German yield was at 2.9662% . The euro was ​down by 0.1% at $1.1597 .

Data ⁠showed German business morale fell sharply in March, as the Iran war made companies more pessimistic, threatening the recovery of Europe's biggest economy.

The U.S. dollar rose slightly against a basket of currencies, with the dollar index at 99.319 . The U.S. 10-year yield was at 4.3401% .

Gold prices rose , as falling oil prices eased ⁠some of ​the concerns about inflation.

The war has killed thousands of people, created the worst energy ​shock in history and sparked global inflation fears. Gulf Arab states told the U.N. on Wednesday that they face an existential threat from Iran.

BlackRock (BLK.N), opens new tab CEO Larry Fink told the BBC that ​oil prices could reach $150 a barrel and cause a global recession.