European Stocks Plunge, Iran-Qatar Energy Attacks Escalate, Triggering Risk-Off
European stocks fell on Thursday (March 19) after tensions escalated following attacks on energy infrastructure in Iran and Qatar. In early trading, the UK's FTSE 100 fell 1.15%, Germany's DAX fell 1.4%, France's CAC 40 fell 1%, and Italy's FTSE MIB fell 1.2%, marking a return to risk-off mode in regional markets.
The mining sector led the decline, with Stoxx Europe Basic Resources down 4.5% as of 8:45 a.m. London time, following sharp sell-offs in spot gold and silver, which fell 2.6% and 6.9%, respectively. In the UK, Antofagasta and Fresnillo both fell around 6%, amid concerns about inflation and rising energy costs that could potentially squeeze producer margins. The weakness spread to other sectors, including banking and tourism.
The latest escalation occurred on Wednesday when Israel attacked Iran's South Pars gas field, prompting Tehran to respond with a missile attack on Qatar's Ras Laffan LNG terminal. US President Donald Trump warned that if Iran continued to target Qatari energy facilities, the US would launch a major attack on South Pars. Oil prices surged again following the attack and these comments, adding to inflationary pressures and worsening equity sentiment.
European markets are also focused on Thursday's monetary policy decisions by regional central banks, including the ECB, Bank of England, Riksbank, and Swiss National Bank. Markets widely expect interest rates to remain on hold, while policymakers assess the impact of the Iran war on growth and inflation—particularly through the energy channel—which could alter future policy paths.
In global markets, US stock futures edged lower after the Dow Jones Industrial Average hit a new 2026 low. Risk-off pressure was exacerbated by a surprise US producer price report and higher inflation expectations, fueling concerns that the Iran war could push the US economy toward a stagflation scenario. Asia-Pacific markets also fell on Thursday, following Wall Street's decline. (alg)
Source: Newmaker.id
