European Stocks Edge Lower Amid Iran Tensions and Rising Oil Prices
European stocks were subdued on Monday as investors digested fresh U.S.-Iran military strikes that pushed oil prices and bond yields higher. The pan-European STOXX 600 index fell 0.1% to 655.54 points, with trading volumes likely to be low due to a London bank holiday.
The DAX dropped 0.7%, the most among regional indexes, ahead of German inflation data that could provide clues on the European Central Bank's rate path. Investors are largely expecting a September ECB rate increase, but may reassess their expectations based on this week's data.
Energy stocks firmed up, tracking a more than 2% jump in Brent crude to $90.70 a barrel. TotalEnergies, Orlen, and OMV rose between 1.8% and 3.8%. The rise in energy prices has reinforced inflation concerns at a time when investors are bracing for further policy tightening.
Finance leaders from the G20 are gathering in North Carolina on Monday and Tuesday to discuss global growth prospects, which are being weighed down by elevated energy and commodity prices linked to the Iran war. OHB gained 7.3% after signing a €1 billion contract with the European Union's IRIS² secure communications programme.