European shares climb on Iran sanctions relief, defence gains

Business Recorder reported that European shares edged higher on Tuesday as traders were reassured that a new US sanctions package against Iran was less severe than feared. The pan-European STOXX 600 rose 0.3 per cent to 656.14 by 0718 GMT, with defence shares leading sector gains of 1 per cent.

On Monday, Washington told countries to scale back trade with Iran or risk secondary sanctions, a campaign it labelled an economic D-Day. Even so, the Treasury Department did not impose any penalties. Crude prices extended their decline as the newest American measures were seen as posing few near-term dangers to worldwide oil availability. Iran vowed to respond to the broader US sanctions and expressed confidence that its major trading partners would withstand the pressure.

Yields on American government bonds pulled back from their latest highs, after reports suggested the department could draw on cash reserves to fund bigger debt buybacks, reducing the need for additional short-term bill sales. Technology shares rose 0.3 per cent as investors looked ahead to Nvidia's results on Wednesday, amid worries the chipmaker might find it hard to meet high expectations.