San Francisco Frontiers - Oil strikes 4-year peak, stocks diverge as central banks in focus

International benchmark Brent crude soared more than seven percent to $126 a barrel, but then eased in midday trading in London.

Markets were jolted after President Donald Trump warned the US blockade of Iranian ports could last months and by a report that he would be briefed on potential fresh military strikes.

"With no sign of any peace talks and fears mounting about an escalation, oil prices have continued their gains," said Jim Reid, managing director at Deutsche Bank.

"Investors are pricing in a more protracted conflict," he added, with both sides at loggerheads over Iran's nuclear programme.

Trump is expected to receive a briefing on new plans for potential military action in Iran from Admiral Brad Cooper, the head of US Central Command, two sources with knowledge of US planning told news platform Axios.

As negotiations have stalled, the Islamic republic has maintained its stronghold over the strategic Strait of Hormuz, through which one fifth of the world's oil usually passes.

Central banks remain a focus on Thursday after the Federal Reserve kept interest rates unchanged the day before as the US faces elevated inflation triggered by the war.

The European Central Bank and Bank of England are set to follow suit later in the day, with investors closely watching for signals on the outlook for rates.

On a busy day also for corporate earnings, London and Frankfurt stock markets rose while Paris fell.

Official data on Thursday showed eurozone economic growth dropped to near zero in the first three months of 2026 as surging energy costs pushed inflation sharply up in April.

Asian stock markets mostly fell, with Tokyo and Hong Kong both closing one percent lower. Shanghai gained.

South Korea's Samsung Electronics reported a 750 percent surge in first-quarter operating profit Thursday thanks to strong sales of chips crucial for artificial intelligence.

That came after US tech titans Microsoft, Meta and Google-parent Alphabet posted forecast-busting earnings.

"There were earnings beats across the board, but investors continue to be wary of increasing capex budgets as the roll out of AI infrastructure continues," said Derren Nathan, head of equity research at Hargreaves Lansdown

In other corporate news, global automaker Stellantis shares slumped more than six percent in Paris failed to reassure investors.

- Key figures at 1040 GMT -

Brent North Sea Crude: DOWN 1.3 percent to $116.50 a barrel

West Texas Intermediate: DOWN 0.2 percent at $106.70 a barrel

London - FTSE 100: UP 1.0 percent at 10,318.70 points

Paris - CAC 40: DOWN 0.6 percent at 8,026.85

Frankfurt - DAX: UP 0.3 percent at 24,029.31

Tokyo - Nikkei 225: DOWN 1.1 percent at 59,284.92 (close)

Hong Kong - Hang Seng Index: DOWN 1.3 percent at 25,776.53 (close)

Shanghai - Composite: UP 0.1 percent at 4,112.16 (close)

New York - Dow: DOWN 0.6 percent at 48,861.81 (close)

Euro/dollar: UP at $1.1705 from $1.1695 on Wednesday

Pound/dollar: UP at $1.3515 from $1.3489

Dollar/yen: DOWN at 157.87 yen from 160.23 yen

Euro/pound: DOWN at 86.59 pence from 86.71 pence

A.Evans--SFF