European Stocks Rise as Fears of Middle East War Drive Oil Prices Higher

By Christian Moess Laursen

European stock markets rose slightly as oil prices jumped on concerns of Middle East supply disruptions, after an escalation of conflict in the region with Iran's missile attack against Israel.

Iran fired overnight at least 180 ballistic missiles at Israel in retaliation for Israeli attacks on Hezbollah in Lebanon. Israel quickly vowed revenge.

In a muted start of the session in Europe, most national stock benchmarks logged small gains in early trade Wednesday, partially recovering from losses across most European bourses on Tuesday. Energy and defense stocks were among the biggest risers, with shares in airlines among the biggest losers.

Brent crude oil is up 2.4% at $75.36 a barrel, while crude oil WTI is up 2.6% at $71.66 a barrel, driving shares in Europe's major oil and gas producers. Shell and BP are topping London's FTSE 100 index, while TotalEnergies and Eni are among the top gainers on France's CAC 40 and Italy's FTSE MIB.

A regional war would threaten oil supply which is why oil prices are trading higher, Swissquote Bank senior analyst Ipek Ozkardeskaya said in a note.

The FTSE 100, London's blue-chip index, led the gainers in the region, rising 0.5%. France's CAC 40 and Germany's DAX were up 0.3% and 0.1%, respectively, while Italy's FTSE MIB rose 0.3%.

The Euro Stoxx 50, which includes eurozone blue-chip stocks, is up 0.6%, while the broader Stoxx Europe 600 is up 0.3%.

"The challenge of avoiding a regional war is at its most difficult point since Oct. 7," Jonathan Panikoff, a former U.S. intelligence officer now with the Atlantic Council, a Washington-based think tank, told the Wall Street Journal.

Write to Christian Moess Laursen at christian.moess@wsj.com

(END) Dow Jones Newswires

October 02, 2024 04:11 ET (08:11 GMT)

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