The FTSE MIB fell 0.7% to 43,702 on Thursday as markets navigated uncertainty over Middle East peace talks. The US pushed back against talks after Iran had countered their first proposals for a ceasefire, raising oil prices and stoking inflation worries. Energy-driven stagflation fears lifted bond yields and the BTP-Bund spread widened sharply, pressuring financials. UniCredit lost 2%, Intesa Sanpaolo fell 1.8%, and Finecobank posted a 1.6% loss. Oil-related stocks gained on higher commodity prices: Eni rose 2% and Saipem surged 5.8%. Recordati Ord rose 4.7% on takeover bid rumors from CVC.