On the macroeconomic front, the World Bank revised its global growth forecast for 2026 downward to 2.5%, citing the repercussions of the conflict in the Middle East. The institution emphasized that an escalation of tensions, accompanied by a further spike in energy prices and financial turbulence, could drag growth down to 1.3%.

Furthermore, the ECB raised its key interest rates by 25 basis points, bringing its deposit rate to 2.25%. This marks the first hike since September 2023, making it the third G10 central bank to tighten monetary policy since the start of the Iran-Israel conflict, following Norway and Australia.

According to Juliette Cohen, strategist at CPR Asset Management, the rate hike announced by the ECB reflects its commitment to addressing an energy shock whose effects are gradually spreading throughout the economy. However, she noted that the institution provided no further clues regarding the future direction of its monetary policy. In this context, the evolution of the Middle East conflict and upcoming inflation data are expected to be decisive for the July meeting.

For his part, Konstantin Veit, portfolio manager at PIMCO, believes this decision is more of an adjustment intended to anchor market expectations rather than the start of a genuine monetary tightening cycle.

In the United States, published indicators sent mixed signals. Weekly jobless claims rose more sharply than expected, pointing to a gradual cooling of the labor market. At the same time, producer prices accelerated significantly in May, fueling fears of persistent inflation and reinforcing the Fed's cautious stance.

Trump Intends to Strike Iran 'Very Hard' Tonight

Geopolitical tensions remained at the forefront of concerns following Iran's announcement of the closure of the Strait of Hormuz and new threats of strikes from Donald Trump, raising fears of a fresh regional escalation. The U.S. President threatened new strikes against Iran, stating on his social network that the United States would hit the country 'very hard' this evening.

Corporate News

The main Paris index was supported by STMicroelectronics (+5.74%) and Schneider Electric (+2.56%).

Hugo Boss surged 9% in Frankfurt following the announcement of a takeover bid worth nearly €2bn launched by Frasers Group. Wizz Air (+4.86%) also stood out after reporting an annual profit slightly above expectations.

In the foreign exchange market, the euro slipped 0.12% to $1.1519.