US stock futures indicated a broadly neutral open while European equities rose 0.3% on Thursday, as investors adopted a cautious stance amid ongoing energy supply disruptions linked to the conflict involving the US, Israel, and Iran. According to Morningstar’s chief European markets strategist Michael Field, markets are experiencing a pause after several days of declines, with traders reassessing the situation.
The conflict, now in its sixth day, has brought tanker traffic through the Strait of Hormuz to a near standstill despite US efforts to facilitate maritime passage through escorts and insurance guarantees. Brent crude oil resumed gains to reach USD 84 per barrel, while European natural gas prices extended gains to a one-year high.
Energy Supply Concerns Drive Market Volatility
The Strait of Hormuz crisis has created significant uncertainty in global energy markets. According to market intelligence firm Kpler, the critical maritime route accounts for 31% of the world’s seaborne crude exports, making its disruption a major concern for oil-importing nations.
Additionally, Reuters reported Wednesday that Qatar’s LNG facility, which supplies nearly 20% of global liquefied natural gas, will be fully shut down. Morningstar analyst Adam Baker indicated that a restart will take weeks from any decision point, though no major damage has been reported to the facility.
However, the Trump administration announced measures to address the Strait of Hormuz disruptions. White House spokesperson Karoline Levitt stated the US would provide risk insurance and possible naval convoys to help resume trade through the route, with more details expected in the coming days.
Asian Markets Rebound Sharply from Previous Losses
Asian stocks rebounded nearly 11% from the prior session’s steep selloff, with Korean stocks recouping most losses after experiencing their worst one-day performance since 2008. The South Korean government announced a market stabilization package worth approximately USD 68 billion on Thursday, driving the rally.
Meanwhile, senior analyst at Swissquote Ipek Ozkardeskaya cautioned that the extreme volatility signals underlying market stress. The major oil-importing nation had been particularly hard hit by concerns over energy prices amid the virtual closure of the Strait of Hormuz.
The region’s broader Morningstar Asia Index closed 2.6% higher in dollar terms, reflecting improved sentiment following the stabilization measures.
Corporate Earnings Continue Despite Geopolitical Tensions
In contrast to the macroeconomic concerns, year-end earnings drove significant individual stock performance across European markets. Britain’s Rentokil jumped 12% after earnings beat expectations, while drinks maker Campari rose 8% following surprisingly optimistic guidance for 2026.
However, not all companies fared well in earnings season. Italian communications technology firm Nexi slumped as much as 20% after missing earnings expectations, reaching a new all-time low. Hearing aids maker Amplifon fell 11% despite meeting sales targets, as guidance lacked detail regarding mergers and acquisitions, according to Morningstar analyst Max Jousma.
Market participants await further details from the US administration regarding insurance and naval escort arrangements for the Strait of Hormuz, which could determine whether energy supply disruptions ease in coming days. The timeline for Qatar’s LNG facility restart remains uncertain, with analysts indicating weeks may be required before operations resume.