European Stocks Slip as US-Iran Tensions Push Oil Above $90
European stocks fell as US-Iran tensions lifted Brent above $90 and raised inflation concerns; the STOXX 600 dropped 0.2% as energy gained and travel names lagged.
European equities fell on Monday after rising tensions between the United States and Iran pushed Brent crude above $90 a barrel, raising concerns about inflation and corporate costs. The pan‑European STOXX 600 declined 0.2% to 640.45, with energy stocks higher and travel names under pressure.
US strikes on Iran entered a ninth consecutive day and reports that several tankers were immobilised increased perceived risks to shipping through the Strait of Hormuz. Those developments helped lift Brent crude to its highest level in a month, prompting concern that higher fuel costs could add to inflation and squeeze company margins.
The European energy index rose 1.4% as investors adjusted revenue expectations for oil and gas firms in response to higher crude prices. The travel and leisure sector fell 1.3%, reflecting expectations of higher jet fuel costs and increased operating expenses for airlines and other travel companies. Ryanair shares dropped 5.71% after the carrier reported a decline in first‑quarter profit and attributed the weaker result to higher fuel costs and lower fares despite continued passenger demand.
Technology stocks provided limited support, rising 0.4% as markets looked ahead to upcoming earnings from major US tech companies. Last week, positive forecasts and results from semiconductor firms, including ASML and TSMC, produced only a muted market reaction.
Investors are also preparing for the European Central Bank’s policy meeting later this week, where the bank is widely expected to leave interest rates unchanged. Market participants will monitor the meeting for any signals on the future path of monetary policy, given the potential for higher oil prices to keep inflation pressures elevated.
Geopolitical developments, energy‑price moves, the approaching corporate earnings season and the ECB meeting combined to keep sentiment cautious across European markets. Market participants awaited clearer catalysts before making larger position changes.
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