European Stocks Under Sharp Pressure at the Start of the Week
European stock markets weakened on Monday (March 23), with the STOXX 50 and STOXX 600 both falling around 1.5%. This decline extended last week's decline of nearly 3.8%, bringing both indexes back to their lowest levels since September and November of last year. Investor sentiment remained weighed down by the escalating conflict in the Middle East, which continued to push up oil prices.
Risk-off pressures intensified after President Donald Trump issued a 48-hour ultimatum to Iran to "fully open" the Strait of Hormuz. Meanwhile, the Speaker of Iran's Parliament warned that entities purchasing US government bonds could be considered "legitimate targets," expanding the risk dimension from geopolitical to financial and amplifying market concerns.
All sectors traded in the red, with financials and industrials leading the decline. Large-cap stocks also fell, including ASML Holding (-1%), HSBC Holdings (-0.8%), and LVMH (-0.4%), indicating market-wide pressure.
On the corporate side, Poste Italiane fell more than 5% and became the biggest drag on the STOXX 600 after announcing a €10.8 billion bid for Telecom Italia. However, Telecom Italia shares actually jumped 5.4% in response to the news.
Newsmaker's takeaway: The decline in European stocks at the start of the week confirms the market's increasing sensitivity to the combination of "oil shock + geopolitics." As long as tensions in Hormuz persist and oil remains high, investors will tend to be defensive—with cyclical sectors like industrials and financials most vulnerable to pressure.
Source: Newsmaker.id
