European Stocks End Tuesday in Red
The benchmark pan-European Stoxx Europe 600 index shed 3.08%, or 19.19 points, closing at 604.44 — dragged lower by sweeping losses across nearly every major sector.
National indices fared no better. Germany's DAX 40 sank 3.44% to 23,790.65, while France's CAC 40 dropped 3.46% to 8,103.84. Italy's FTSE MIB 30 bore the steepest decline among major eurozone benchmarks, tumbling 3.92% to 44,468.46. Spain's IBEX 35 plunged 4.55% to 17,062.4 — the sharpest national index fall of the session — and Britain's FTSE 100 slid 2.75% to 10,484.13.
President Donald Trump added to market unease Tuesday by announcing he intends to sever all trade ties with Spain, after Madrid barred Washington from using Spanish military installations to conduct strikes against Iran.
The selloff was indiscriminate in its reach. Banking stocks shed 4.3%, utility shares fell 4.4%, and insurance equities declined 3.6%. Even the defense sector — which had posted gains in the prior session — reversed course, with the Stoxx Aerospace and Defense index retreating nearly 2.6%.
Travel and leisure shares were also caught in the crossfire, dropping 2% as sweeping airspace shutdowns across the Middle East forced airlines to ground thousands of flights, amplifying fears over the conflict's mounting economic cost.
The escalation deepened as hostilities extended beyond Israel and Iran into the wider Gulf region, solidifying a pronounced risk-off shift among global investors. Safe-haven gold rallied on heightened demand, while equity markets across the US and Asia also moved into negative territory.
Crude oil extended its gains for a second straight session, propelled by fears that critical energy infrastructure could be targeted, threatening to accelerate global inflation.
Iran's Islamic Revolutionary Guard Corps stated Monday that the Strait of Hormuz has been closed to transit and warned that vessels attempting to cross would be attacked — a declaration that sent fresh shockwaves through commodity markets reliant on the crucial waterway.
The European Union called on all sides to step back from the brink, urging maximum restraint and the safeguarding of civilian lives.
On the economic front, eurozone annual inflation ticked up to 1.9% in February from 1.7% in January — a modest acceleration that nonetheless adds complexity to the European Central Bank's policy calculus amid the geopolitical turbulence.
The euro weakened against the dollar, with the EUR/USD rate slipping 0.85% to 1.1591 as of 1740 GMT.
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