European equities advanced on Wednesday as a sixth straight decline in oil prices eased inflation worries and renewed artificial-intelligence enthusiasm lifted technology and semiconductor shares. The pan-European STOXX 600 rose about 0.4% to 645.04 in early trading, with most major regional markets in positive territory.
Oil supply improves Brent crude slipped below $100 a barrel after Saudi Arabia restarted the East-West oil pipeline and prepared to resume crude exports from the Red Sea port of Yanbu. The route can carry around 4 million barrels per day and offers a bypass to the Strait of Hormuz. Lower energy costs could reduce inflation pressure for the European Central Bank and limit the need for further aggressive interest-rate increases. Investors also monitored U.S.-Iran developments, as Iranian officials indicated that reopening the Strait of Hormuz could be part of broader negotiations.
AI and tech momentum Meta’s Muse agent continued to support global technology stocks after becoming one of the most downloaded apps in the United States. Asian technology and semiconductor shares also advanced, with South Korean and Taiwanese markets moving higher, while the Nasdaq returned to record territory. Market participants are watching competing AI products, including new offerings from Alphabet.
Economic data and rates Germany’s composite PMI jumped to 53.8 from 51.8, its strongest reading since October 2025, while France’s composite PMI rose to 51.2 from 48.5. Services activity returned to expansion and manufacturing remained above 50. However, the U.S. 10-year Treasury yield remains close to 5%, and Federal Reserve officials continued to highlight inflation risks after last week’s interest-rate increase. The dollar strengthened against the euro and sterling.
Sector moves Aerospace and defence was the strongest STOXX 600 sector despite cheaper oil. Sweden’s Saab and France’s Exosens were among notable gainers. Bank of America analysts expect European defence-industry revenue to grow about 15% annually through 2030, while Citigroup raised its Saab price target to SEK628 from SEK527. Exosens raised its 2026 guidance after faster expansion in night-vision production and stronger demand for drone and surveillance technology. Energy shares gained about 0.8% even as crude weakened, while KWS dropped about 6% and Adyen slipped around 2%.
For cryptocurrency markets, the combination of lower oil prices and AI-led risk appetite may provide a mildly supportive sentiment backdrop, although elevated U.S. yields and a stronger dollar remain potential headwinds.
