Two of the world’s most influential investment banks just told their clients to get more bullish on Europe. Goldman Sachs and Barclays both raised their year-end targets for the STOXX 600, Europe’s benchmark equity index, citing the ripple effects of a freshly signed US-Iran memorandum of understanding that sent oil prices into a nosedive and equity markets surging.
Barclays moved its STOXX 600 year-end target to 670, up from a previous 620. Goldman Sachs set its own 12-month target at 660. A broader survey of 16 strategists now projects the index to close at 640 by the end of 2026.
What the deal actually changes
The US-Iran MoU, signed around June 17, includes a 14-point framework establishing an immediate ceasefire and a 60-day negotiation window. The agreement reopens the conversation about oil transit through the Strait of Hormuz and lays the groundwork for further discussions regarding Iran’s nuclear program.
Roughly a fifth of the world’s oil supply passes through the Strait of Hormuz on any given day. Oil prices dropped approximately 4% immediately after the deal was announced.
