Caution also dominated trading ahead of the Federal Reserve’s policy decision later in the day and upcoming earnings releases from major US technology companies.

Among individual stocks, Siemens Healthineers (-3.7%), Hannover Rück (-3.2%) and Münchener Rück (-3.1%) recorded the steepest losses. Deutsche Bank slipped 1.9% despite a jump in profits, after signaling higher credit provisions. Mercedes‑Benz Group edged down 0.3%, even as it reported a smaller‑than‑expected decline in earnings. On the upside, Adidas rallied 8.3% after posting a stronger‑than‑forecast first‑quarter profit.

The United States signaled it will, for now, maintain its blockade of Iranian tankers in the Strait of Hormuz, prolonging an impasse that prevents those vessels from exporting energy and driving another leg higher in energy prices.

Financials and industrials led the decline, with Munich Re, Allianz, and Siemens retreating between 2% and 3%. Deutsche Bank dropped nearly 3% despite beating first-quarter estimates, as investors focused on higher credit provisions. Mercedes-Benz and Iberdrola also ended lower after releasing their earnings.

In contrast, Airbus and Adidas surged 5.1% and 8.3%, respectively, after issuing upbeat guidance. The Federal Reserve was expected to leave interest rates unchanged in its decision due after the European market close.

The unchanged 1.2% estimate suggests the model continues to see modest, steady economic expansion at the start of 2026, with no current signal of acceleration or deterioration in near-term growth based on the available data. While GDPNow is a real-time statistical model and not an official forecast, its stability at this level underscores a view of a U.S. economy growing at a measured pace heading into the mid-year period.

Additional upward pressure came from reports that Donald Trump is preparing to extend a blockade on Iranian ports, deepening fears of sustained disruptions to crude flows through the strategically vital Strait of Hormuz. Diplomatic efforts have stalled, with both sides firmly entrenched, reinforcing expectations that the standoff may continue for weeks.

At the same time, US inventory data showed steep draws in crude and refined product stockpiles, while exports jumped to record levels above 6 million barrels per day, highlighting a tightening global supply backdrop. Prices for gasoline and other refined fuels have also spiked, intensifying inflation worries worldwide as energy markets remain highly volatile and on edge.

At the same time, shortages of jet fuel and diesel in Europe and Asia have led major energy producers to prioritize distillate output over motor gasoline, intensifying supply risks in the gasoline market. As a result, US gasoline inventories fell by 6.1 million barrels in the week ending April 24th, far exceeding expectations of a 2.1 million barrel draw and marking the 11th consecutive weekly decline.

The Bank of England is expected to leave interest rates unchanged this Thursday, reflecting caution amid the escalating Middle East crisis, although markets are still pricing in two quarter-point rate increases for 2026. Adding to the pressure, Lloyds has revised its UK economic outlook, lifting its 2026 inflation forecast to 3.4% from 2.6% and cutting its GDP growth projection to 0.5% from 1.2%. The bank no longer expects any BoE rate cuts this year, having previously forecast two, and now sees unemployment peaking at 5.6% in the fourth quarter.

Refinery activity strengthened over the period, with crude runs increasing by 84,000 barrels per day and utilisation rates rising by 0.5 percentage points.

Fuel inventories tightened more than anticipated. Gasoline stocks dropped by 6.075 million barrels to 222.3 million barrels, compared with forecasts for a 2.1 million barrel decline. Distillate inventories—which include diesel and heating oil—fell by 4.494 million barrels to 103.6 million barrels, surpassing expectations for a 2.2 million barrel draw.

Net US crude imports decreased by 1.968 million barrels per day over the week.

The deeper-than-previous drawdown in gasoline inventories is likely to focus market attention on fuel availability heading into the driving season. While the data do not specify the underlying drivers, a continued reduction in stockpiles of this magnitude typically raises questions about refining output, distribution constraints, or sustained consumer demand. Traders and analysts will be watching upcoming reports closely to gauge whether this trend in shrinking gasoline inventories persists and how it may influence fuel prices and broader inflation dynamics in the United States.

The “Actual” reading of 0.5% reflects the change in utilization from the current week compared with the previous one, while the earlier -0.5% “Previous” figure captured the change between the prior week and the week before that. The turnaround suggests that U.S. refiners have slightly stepped up activity after a small pullback, a development closely watched by energy and financial markets for signals on fuel demand, operational capacity, and potential implications for refined product supplies and pricing.

The deeper decline suggests sustained demand or constrained supply relative to earlier periods, as the pace of stock withdrawals has nearly doubled. While the absolute levels of inventory are not detailed, the continued drawdown in heating oil reserves will be watched closely by energy traders and economic analysts for potential implications for refined product pricing and broader fuel market conditions in the United States.

The move from growth to contraction suggests that U.S. refiners have either scaled back operations or faced disruptions that reduced gasoline output. While the specific drivers behind the decline are not detailed in the data, such a swing can reflect changes in seasonal demand patterns, maintenance schedules at refineries, or broader market conditions affecting fuel production.

This downturn in gasoline production will be closely watched by market participants, as sustained lower output could influence domestic fuel inventories, price dynamics at the pump, and broader sentiment in the energy sector.

The acceleration in the drawdown suggests that consumption of distillate fuels—such as diesel and heating oil—remains robust, potentially outpacing supply or refinery output in the near term. For energy and broader financial markets, a steeper-than-prior drop in distillate inventories is typically interpreted as a sign of solid underlying economic activity, particularly in transportation and heavy industry, and can lend support to refined product prices and crack spreads.

Investors and traders will be watching forthcoming EIA reports closely to see whether this sharper contraction in distillate stocks becomes a sustained trend. Continued sizable draws could influence refinery runs, prompt adjustments in crude demand, and shape expectations for freight and industrial momentum heading into the next quarter.

Distillate fuels—which include diesel and heating oil—are closely watched as a barometer of industrial activity, freight demand, and broader economic momentum. The downturn from a previous gain suggests refiners may be adjusting output in response to weaker demand signals or evolving market conditions. While the decline is relatively small, traders and analysts are likely to monitor upcoming data for confirmation of a trend that could influence fuel prices, refinery margins, and expectations for U.S. economic strength in the near term.

The move from a modest increase to a comparable-sized decrease suggests changing dynamics in supply, demand, or both, at one of the most closely watched delivery points for U.S. crude. Market participants often track Cushing inventories as a gauge of regional crude availability and as a reference point for pricing benchmarks tied to the hub.

While the magnitude of the draw is relatively small, the switch from positive to negative inventory growth may influence short-term sentiment in energy markets, particularly for traders watching for signs of tightening or easing conditions in U.S. crude supply. Investors will be monitoring upcoming data to see whether this drawdown at Cushing evolves into a more sustained trend.

The shift from positive to negative territory suggests a notable tightening in supply dynamics, as fewer barrels are entering the U.S. market compared with the previous reporting period. This kind of swing can reflect changing refinery demand, evolving global trade flows, or adjustments in sourcing strategies as market participants respond to price signals and inventory levels.

Market watchers are likely to interpret the latest data as a sign of potential upward pressure on domestic crude prices if the pullback in imports persists, particularly against any backdrop of steady or rising demand. Analysts will be closely monitoring subsequent releases to determine whether this is a temporary fluctuation or the beginning of a more sustained trend in U.S. crude oil import behavior.

The figures highlight a week-over-week turnaround in refinery activity, with the current week’s increase contrasting with the prior week’s pullback. The “actual” reading reflects the change in refinery crude runs compared with the immediately preceding week, while the “previous” figure captured the change seen in that earlier comparison period. This shift suggests a renewed uptick in refinery utilization after a brief period of softening runs.

The abrupt shift from a positive to a strongly negative reading signals a significant tightening in crude supplies relative to the prior period. Such a sizable draw can reflect stronger refinery demand, changes in imports and exports, or short-term supply disruptions, and is closely watched by energy traders for its potential impact on crude prices and market sentiment. Investors and analysts will now be looking to subsequent reports to determine whether this marks the start of a new trend in U.S. oil inventory dynamics or a one-off adjustment.

Shares of major Canadian banks, including BMO, TD, and Royal Bank of Canada, were little changed, trading near the flatline. In contrast, the recent jump in oil prices has buoyed energy stocks, while a modest pullback in gold prices weighed on miners. Canadian Natural Resources rose more than 2%, whereas Agnico Eagle fell over 2%.

In the US, major technology firms—Microsoft, Alphabet, Meta, and Amazon—are scheduled to report quarterly results after the closing bell on Wall Street, with potential spillover effects for Canadian technology names. Shopify shares declined more than 1.5%.

While the Fed is widely expected to leave the federal funds rate unchanged, markets are focused on updated forward guidance, the broader economic outlook, and how the ongoing conflict might influence the policy trajectory. Investors are also looking for clues regarding Chair Powell’s plans once his term expires on May 15.

In parallel, the Justice Department announced it would halt its criminal investigation into Powell, removing a key obstacle to the Senate’s confirmation of his nominated successor, Kevin Warsh.