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Morning Bid Europe

A look at the day ahead in European and global markets

By Gregor Stuart Hunter, Asia Finance & Markets Correspondent

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The clock is ticking for Iran's ceasefire with the U.S. to expire, though markets are looking through the risks for now.

With peace talks in flux, investors are instead piling back into AI-linked ‌stocks on bets that growth will reassert itself.

Today's Market News

Fed's independence under cloud

Former U.S. Federal Reserve Governor Kevin Warsh speaks during a monetary policy conference at Stanford University's Hoover Institution in Palo Alto, California, U.S. May 9, 2025. REUTERS/Ann Saphir/File Photo

An uneasy ceasefire between the United States and Iran frayed after the U.S. announced the seizure of an Iranian cargo ship, drawing vows of retaliation from Tehran. Iran said over the weekend it would skip a second round of negotiations, though a senior official later told Reuters the country may yet send delegates to talks expected in Islamabad.

Adding ⁠to the uncertainty and confusion, Vice President JD Vance remained in the United States, a source said, pushing back against reports he was already on his way to Pakistan for talks.

In this fraught backdrop, a very different risk is emerging for markets: Kevin Warsh. President Donald Trump's nominee to lead the Federal Reserve is scheduled to begin his confirmation hearing before the Senate at 10 a.m. EDT (1400 GMT) on Tuesday, with his independence from the White House likely to be a key focus.

Warsh will say he is "committed to ensuring that the conduct of monetary policy remains strictly independent," according to his prepared remarks.

Graphics are produced by Reuters

AI exuberance

Investors have resumed ‌bets on ⁠AI-linked names in the meantime, after Amazon said on Monday that it will invest up to $25 billion in Anthropic.

South Korea's Kospi hit a record high for the first time since the start of the Iran war, while Taiwanese shares, tech investor Softbank and memory chipmaker SK Hynix set fresh all-time highs.

Shares of Chinese circuit board maker Victory Giant Technology ⁠surged 60% in their Hong Kong debut on Tuesday, after raising HK$20.1 billion ($2.6 billion) in the city's biggest listing in more than half a year.

S&P 500 e-mini futures were up 0.1% while MSCI's broadest index of Asia-Pacific shares ⁠outside Japan rose 0.9%.

Europe also pointed to a firmer opening, with pan-region futures up 0.3%, German DAX futures 0.3% higher, and FTSE futures up 0.2%.

Key developments that could influence markets on Tuesday:

Company earnings: GE Aerospace <GE.N> , UnitedHealth Group <UNH.N>, RTX Corp <RTX.N> , Associated British Foods <ABF.L>.
Economic data: UK unemployment for March, average weekly earnings for February; Germany's ZEW economic sentiment and current conditions for April.
Debt auctions: Germany's 2-year government debt, UK's 3-year government debt.

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