Euro Stocks Stagnate Amid Iran Sanctions Uncertainty

European shares were largely unchanged on Monday as investors digested uncertainty surrounding US sanctions on Iran. The STOXX 600 index, a benchmark for European stocks, rose by just 0.03% to 654.38 points. Higher gold prices, which climbed due to a weaker dollar, provided some support to the market.

The Basic Resources sector was a top performer, increasing by 0.7%, as investors sought safe-haven assets amidst rising tensions in the Middle East. Meanwhile, energy shares declined by 0.6% in line with falling Brent crude prices, which stood at around $93 per barrel.

Money markets are pricing in a more hawkish European Central Bank (ECB) due to concerns over inflation and geopolitical risks. Investors are looking ahead to the ECB's September meeting, where policymakers will reassess their monetary policy stance. The Fed's interest rate outlook is also expected to be clarified by Federal Reserve Chair Kevin Warsh at an upcoming event in Jackson Hole.