US stock markets close Monday at record highs as Middle East tensions ease

US stock markets closed at record highs on Monday as US President Donald Trump said Iran would continue negotiations, while European indexes all closed in the red.

The Dow Jones rose 0.09%, or 46.42 points, to finish at 51,078.88.

The S&P 500 gained 0.26%, or 19.9 points, to close at 7,599.96, while the Nasdaq rose 0.42%, or 114.19 points, to 27,086.81.

The Volatility Index (VIX), often referred to as the market’s “fear index,” rose 4.77% to 16.05.

On Monday, Iran suspended indirect exchanges and text-sharing with the US through mediators in protest over continued Israeli attacks in Lebanon, Iran’s semi-official Tasnim news agency reported.

The Intelligence Organization of Iran’s Islamic Revolutionary Guard Corps (IRGC) also said Tehran views any crossing of what it described as red lines in Lebanon and Gaza as a direct war and an attempt to impose costs on Iran’s national security and the so-called resistance axis.

Trump said he was "going to ask" Israeli Prime Minister Benjamin Netanyahu "what’s going on with Lebanon."

He said that "all shooting" between Israel and Hezbollah would be halted following a series of phone calls involving both sides, "There will be no Troops going to Beirut, and any Troops that are on their way, have already been turned back."

Trump also said that he would welcome a period of silence if Iran suspends indirect peace talks with Washington.

European markets

Closing before Trump's statements, European stocks suffered from Middle East tensions as the pan-European Stoxx Europe 600 index fell 0.76% to close at 621.24 points.

In national markets, the UK's FTSE 100 posted a decline, up by 0.68% to 10,338.95, and Germany's DAX 40 fell 0.4% to 25,003.04 points.

France's CAC 40 decreased 0.45% to 8,146.59, Italy's FTSE MIB 30 dropped 0.52% to 49,775.16, and Spain's IBEX 35 was down 0.97% to end at 18,184.90.