Europe Stocks Steady Amid US-Iran Tensions, Await Economic Data

European stock markets remained steady on Monday as investors watched for developments in US-Iran tensions and awaited key economic data. The pan-European STOXX 600 closed flat at 654.21 points, unchanged from the previous day's close.

Investors are bracing for potentially tougher US secondary sanctions on countries with trade ties to Iran, expected to be announced by Treasury Secretary Scott Bessent. Pakistan's army chief is also in Tehran, attempting to bring Iran back to the negotiating table.

Chris Beauchamp, chief market analyst at IG Group, warned that 'there are a lot of unknowns riding on this (sanctions) at the moment.' He noted that if tensions escalate, it could have severe consequences for European markets.

Economic data releases this week will provide further insight into the European Central Bank's policy path. German and French GDP data, the German Ifo survey, and Spanish inflation figures are all on tap, which may test expectations for a more hawkish ECB amid renewed pressure from energy prices.