FX.co ★ European Stocks Close Lower on War Escalation

European equities closed sharply lower on their first trading day since last Thursday, as mounting fears of an escalation in the Middle East conflict heightened the risk of an energy crisis for major European oil and gas importers. The Eurozone’s STOXX 50 fell 1.1% to 5,630, while the STOXX 600 declined 1% to 591. US President Trump intensified rhetoric by warning of possible overnight attacks in a last attempt to pressure Iran into a deal, but Tehran said it had cut its communication channels with Washington, fueling concerns that any regional strikes could become more aggressive. The ensuing rise in oil and natural gas prices pushed bond yields higher and weighed on industrials, with Siemens, Schneider, and Airbus each losing nearly 2%. ASML dropped 4% after US lawmakers introduced the MATCH Act, designed to tighten existing curbs on exports of semiconductor manufacturing equipment, particularly targeting chipmaking tool sales to China.