European Stocks Dip as US-Iran Tensions Escalate Oil Prices

European stocks dipped on Monday as tensions between the US and Iran escalated, pushing oil prices higher. The STOXX 600, a benchmark index of European shares, fell 0.1% to 655.54 points by 0712 GMT.

The decline in stock markets came as investors weighed the impact of fresh US-Iran military strikes on global growth prospects. Energy stocks fared better, however, with TotalEnergies, Orlen, and OMV rising between 1.8% and 3.8% following a more than 2% jump in Brent crude to $90.70 a barrel.

Germany's DAX dropped 0.7%, the most among regional indexes, ahead of inflation data from the euro zone's largest economy that could offer clues on the European Central Bank's rate path. Investors have largely locked in expectations of a September ECB rate increase, but Chris Weston, head of research at Pepperstone Group, noted that European inflation dynamics may be massaged around the edges.