European Stocks Dip as Oil Prices Soar Amid U.S.-Iran Tensions
European stock markets declined on Monday due to rising oil prices following fresh U.S.-Iran attacks, which stoked inflation concerns and heightened expectations of a potential interest rate hike by the European Central Bank later this week.
The pan-European STOXX 600 index fell 0.1% to 649.17 points as of 0711 GMT, while Switzerland's main index dropped 1.2%. The German DAX was flat, largely in line with other regional bourses.
Novartis shares plummeted by 3.3% after the company's experimental drug pelacarsen failed to meet a key goal in a late-stage trial. However, energy stocks advanced 1.2%, tracking higher oil prices. Brent crude futures rose more than $1 per barrel as tensions between the U.S. and Iran intensified.
The increased oil prices have fueled inflation concerns, strengthening the case for further policy tightening by the ECB. The bank is widely expected to raise rates by 25 basis points on Thursday, while investors will also monitor second-quarter euro zone economic data due later in the day.