European Markets Slide as Iran Tensions Resurface

The pan-European STOXX 600 index retreated 1.6% to 636.08 points by 0839 GMT, recording its most significant single-day loss since the March peak of regional tensions. Investors dumped equities across the board, with defense stocks leading the sell-off with a 3.5% drop, while auto manufacturers saw values slide by 3.3%.

Energy markets told a different story, as crude prices climbed 5%, lifting the energy sector by 2%. This spike proved punishing for the aviation industry, which faces rising operational costs; Air France and Wizz Air both suffered losses exceeding 5%. Lufthansa shares fell 5.4% after Citigroup analysts downgraded the airline from neutral to sell. The uncertainty follows Trump’s comments ahead of a NATO summit in Turkey, where he labeled ongoing negotiations with Iranian leadership a waste of time.