European stocks declined at the open on Monday, impacted by heightened tensions and military conflict in the Middle East.
The Stoxx Europe 600 fell 1.7% to 623 points at 11:13 a.m. Mecca time, reaching its lowest level since mid-February. This decline reflects investor concerns about the potential for wider regional instability.
France’s CAC 40 dropped by more than 2% to 8404 points, while Germany’s DAX lost 2.25% to trade at 24717 points. The UK’s FTSE 100 decreased by 0.75% to 10828 points. These broad-based declines indicate a risk-off sentiment across major European markets.
The travel and leisure sector, including airlines and hotels, saw the largest decrease, falling 4.4%. Shares of Lufthansa declined 11% after the German airline extended the suspension of its flights due to the situation in the Middle East. The disruption to air travel highlights the immediate impact of the conflict on the industry.
Conversely, the energy index rose 3.5%, supported by increases in major energy company stocks such as Shell, BP, and TotalEnergies, each rising by more than 5%. This increase coincided with a 13% jump in oil prices following disruptions to navigation in the strategic Strait of Hormuz. The surge in energy prices underscores the sensitivity of global markets to geopolitical events in key oil-producing regions.
