Oil Prices Send European Stocks into a Holding Pattern

European stocks closed flat on Monday as rising oil prices following renewed US-Iran tensions fueled inflation concerns, offsetting stronger-than-expected eurozone economic data.

The pan-European STOXX 600 ended at 649.9 points, while the Swiss main index dropped 0.8%.

Heavyweight Novartis fell 3.2% after its cholesterol drug failed in a closely watched study.

Germany's DAX fell 0.2%, but investors seem to see the recent election results as a political warning rather than an immediate economic threat, according to Axel Rudolph, chief technical analyst at IG.

The AfD party topped a state election in Saxony-Anhalt with 44% of the vote, dealing a major blow to Chancellor Friedrich Merz. However, it remains unclear whether they can form a government for the state as they fell short of an absolute majority.

Energy shares gained 1.2%, tracking higher oil prices, which hovered near six-week highs and moved closer to $100 a barrel due to strikes on vessels in the Strait of Hormuz and elsewhere.