European Equities Slide as US-Iran Conflict Escalates and Oil Prices Surge

European equity indices faced sharp selling pressure on Monday as geopolitical tensions between the United States and Iran entered a critical phase. The downturn followed the U.S. seizure of an Iranian vessel and Iran's subsequent refusal to send a delegation for peace negotiations. The closure of the Strait of Hormuz has reignited fears regarding global energy supply chains, fueling concerns over renewed inflation and higher interest rates. This instability is reflected in the commodities market, where Brent crude prices surged by more than 6%. The pan-European Stoxx 600 declined 1.1% to 619.54, erasing gains from the previous session. National indices followed suit, with Germany's DAX falling 1.6%, France's CAC 40 dropping 1.1%, and the U.K.'s FTSE 100 sliding 0.6%. Airline carriers were among the hardest hit due to rising fuel costs, with easyJet, Lufthansa, and Wizz Air Holdings seeing losses between 3% and 5%. Other notable declines included Siemens (-2.3%) and UniCredit (-2.2%), while British engineering firm Renishaw bucked the trend, rising 7% on upgraded revenue and profit forecasts. Adding to the volatility, German producer prices showed a monthly increase of 2.5% in March, significantly exceeding the expected 1.4% rise. On an annual basis, producer prices fell 0.2%, marking the slowest pace of decline since March 2025.