European Markets Open Negative: Middle East Domino Effect
European markets began the week with a risk-off mood, after global markets were dragged down by the major US and Israeli attacks on Iran over the weekend. Sentiment immediately shifted to the defensive—investors reduced risky assets and began to focus on "safety mode."
The pan-European Stoxx 600 index fell 1.4% shortly after the London open on Monday (March 2). Nearly all sectors were in the red, except for oil & gas, which remained relatively resilient due to the surge in energy prices.
The pressure was felt most strongly in the major indices: the UK's FTSE -0.9%, Germany's DAX -2.3%, France's CAC 40 -2.4%, and Italy's FTSE MIB -1.7%. The movements were simultaneous—indicating that the market views this as a global risk, not a local issue.
Globally, the main concern is the potential for energy supply disruptions. Crude oil briefly surged more than 8% due to market fears of distribution disruptions. The impact has spread to risk-sensitive stocks, including the transportation sector: airline stocks have been hit amid airspace disruptions and airport closures in the Middle East.
The situation is further complicated by Iran's reported retaliatory attacks on US bases in the Middle East, with reports that three US military personnel were killed in the operation. This makes it difficult for the market to maintain a "quick end" scenario, so volatility remains potentially high.
On the agenda, European investors are also monitoring earnings releases (Bank of Ireland Group, Smith & Nephew, Galp Energia) as well as key data such as German retail sales and Italian GDP. But for now, market direction remains largely determined by geopolitical headlines and oil movements.
Source: Newsmaker.id
