European markets move higher as traders track Middle East turmoil

LONDON — European stocks were higher on Wednesday as markets continue to track the war in the Middle East.

The pan-European Stoxx 600 had gained 1.6% by around 4 p.m. in London (11 a.m. ET), with all major regional bourses up and all but one sector — chemicals — trading higher.

Spain's IBEX 35 was up 2% after U.S. President Donald Trump threatened to cut off all trade with the country. Spain had declined to allow U.S. forces to use its bases for strikes on Iran.

"Spain has been terrible," Trump said on Tuesday. "We're going to cut off all trade with Spain. We don't want anything to do with Spain."

Spanish Prime Minister Pedro Sanchez reiterated criticisms of the conflict in the Middle East in a televised address on Wednesday morning, calling the U.S. and Israel's strikes on Iran a "disaster" and likening it to the invasion of Iraq in the early 2000s.

U.S. Treasury Secretary Scott Bessent said in an interview with CNBC's "Squawk Box" on Wednesday that Trump's recently announced 15% global tariff will be implemented sometime this week. Bessent also said that levies would soon return to their old rate after the Supreme Court struck down much of Trump's expansive tariffs.

"It's my strong belief that the tariff rates will be back to their old rate within five months," Bessent said.

Bessent also sought to assuage fears around surging oil prices, saying the government is set to roll out a series of measures aimed at stabilizing oil shipments through the Persian Gulf.

This began yesterday with Trump saying that the U.S. would provide insurance to tankers in the Persian Gulf to get maritime traffic moving through the Strait of Hormuz. He also said the Navy will escort tankers in the region, if necessary. Oil prices eased Tuesday in extended trading.

The higher open in Europe on Wednesday — which follows Tuesday's sell-off — comes as U.S. and Israeli attacks on Iran continued overnight with Western countries trying to organize evacuation flights for their citizens in the region.

Among individual names, Novo Nordisk rose steadily on Wednesday and was last seen up 5.4%. It comes after shares have fallen almost 20% over the last month as investors' increasingly doubt its pipeline and commercialization of future drugs.

Lottomatica, the Milan-listed online gaming and sports betting imprint, surged to the top of the Stoxx 600, notching almost 12% after a strong earnings report, which included a 45% year-on-year jump in adjusted net profits. In contrast, shares in London-listed Weir Group fell 11% as the Scottish engineering multinational updated investors on earnings.

In Asia-Pacific markets overnight, South Korea's Kospi plunged over 12% before paring some losses.

In the U.S., the S&P 500 traded 0.3% higher on Wednesday morning following a volatile session on Tuesday.

Meanwhile, the United Arab Emirates' stock markets reopened Wednesday after a two-day closure following Iranian drone and missile strikes on the region. Stocks listed in Dubai and Abu Dhabi tumbled after trading resumed.