Global Economy
Europe’s Stock Markets Slip as Iran Conflict Enters 13th Day, Fueling Risk Aversion
European equities continued to fall on Thursday, driven by heightened geopolitical tension as the Iran‑Israel war entered its 13th day. The CAC 40, FTSE 100 and DAX all posted losses, while oil prices briefly reclaimed the $100‑per‑barrel mark. Risk‑off sentiment pushed the euro‑area volatility index above 25, and the U.S. dollar and Treasury yields edged higher.
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European Indices Slide
CAC 40 slipped 0.56% to around 8,000 points by 08:30 GMT, extending a decline that started the day before. In London, the FTSE 100 fell 0.61%, and Germany’s DAX lost 0.32%.
The pan‑European EuroStoxx 50 slipped 0.41%, the FTSEurofirst 300 dropped 0.52%, and the broader Stoxx 600 fell 0.42%. The biggest drags came from the financial sector (‑0.86%) and consumer stocks (‑0.83%), both vulnerable to a worsening macro environment.
U.S. Futures Echo the Downtrend
Wall Street futures pointed to a lower open: the Dow Jones down about 0.75%, the S&P 500 down 0.63% and the Nasdaq down 0.61% after a choppy previous session.
Volatility Remains Elevated
Both the U.S. VIX and the Euro Stoxx 50 volatility gauge stayed high, hovering around the 25‑point level, a clear sign of market nervousness.
Oil Prices Re‑Enter $100+ Territory
Brent crude climbed back above $100 per barrel despite the International Energy Agency’s (IEA) proposal to release 400 million barrels to tame soaring energy prices. The continuation of the Iran‑Israel war, now in its 13th day, keeps the global energy trade under strain and threatens further price spikes.
According to maritime‑security firms, Iranian boats loaded with explosives attacked two tankers in Iraqi waters on Wednesday, setting them ablaze and killing a crew member. Earlier, projectiles struck four vessels in the Gulf, underscoring the escalating risk to shipping lanes.
Contrasting Narratives
The latest comment from former U.S. President Donald Trump – that America has already won the war – stands in stark contrast to on‑the‑ground reports of ongoing hostilities.
Analyst Viewpoint
ING analysts noted that there is no sign of de‑escalation in the Gulf, meaning disruptions to oil flows through the Strait of Hormuz are unlikely to subside soon.
Risk‑Off Market Moves
The U.S. dollar firmed, Treasury yields rose, and gold gained modestly as investors leaned into safe‑haven assets amid the heightened risk aversion.
Source: Reuters