Scenes of damaged buildings after Israeli attacks in the Laylaki and Haret Hireyk neighborhoods in the Dahieh district of Beirut, Lebanon, on October 1, 2024.
Hussam Shibarro | Anadolu | Getty Images
LONDON – European stocks ended lower on Tuesday, giving up earlier gains as worries grew about a potential Iranian attack on Israel.
Pan-European Stoke 600 It temporarily closed down about 0.4%, with most sectors in negative territory. The European banking index led the decline, falling 2.2%.
European stocks were lower in afternoon trading after the United States saw signs that Iran was preparing to launch a ballistic missile attack on Israel, a senior White House official told NBC News on Tuesday.
Oil prices rose more than 4% after the news broke. International benchmark Brent crude futures due in December rose 4.2% to $74.73 a barrel, while U.S. West Texas Intermediate crude futures rose 4.5% to $71.22 a barrel.
The notification of a possible Iranian attack came as Israeli ground forces launched a ground incursion into Lebanese territory. Israel last week killed Hezbollah leader Hassan Nasrallah in an explosion in Beirut, Lebanon. Hezbollah is an Iranian-backed militant group.
Eurozone inflation below ECB target
On the data front, Eurozone inflation Preliminary data on Tuesday showed interest rates fell below 2% for the first time since mid-2021, potentially increasing the likelihood of another rate cut by the European Central Bank.
Inflation among the Group of 20 economies fell to 1.8% in September, according to Eurostat, below economists' forecasts of 1.9% and down from August's 2.2%.
Matthew Ryan, head of market strategy at financial services firm Ebury, said the document effectively “seals the deal” and that the European Central Bank will meet later this month to cut interest rates for a second consecutive 25 basis points.
“While President Christine Lagarde told the market at the last meeting that an October rate cut was not in the central bank's baseline scenario, we believe macroeconomic data thereafter will most likely force the central bank to take action,” he said in a note. “It is expected that production may be reduced in December.
The regional data comes after preliminary unified German inflation data released on Monday showed the country's consumer price index fell to 1.8% in September from 2% in August. According to a Reuters poll of economists, the figure was expected to be 1.9%.
Last week, preliminary data showed that unified inflation rates in France and Spain also fell below the European Central Bank's September 2% target.
stock trend
Take a look at the trend of individual stocks, the shares of German Chemical Group Covestro Abu Dhabi's national oil company Adnoc's shares rose 3.8% after it agreed to acquire the company for 14.7 billion euros ($16.3 billion).
Meanwhile, the British bakery chain Greggs It fell 5.2%, and sales growth showed signs of cooling.
Renault The stock fell 3%, extending losses in the auto sector in the previous session, as pressure on the industry mounted and competition from China intensified.
European stocks got off to a volatile start to October after closing lower in the previous session.
U.S. stocks fell on Tuesday as markets closely watched escalating tensions in the Middle East.
Investors also digested comments from Federal Reserve Chairman Jerome Powell, who said on Monday that the Fed “is not following any preset path” when it comes to the next step in interest rate policy. He said that if the economy performs as expected, he expects to cut interest rates twice more this year, which is a quarter of a percentage point each time.
Asia-Pacific markets ended mixed on Tuesday, with markets in South Korea, Hong Kong and mainland China closed for public holidays. Mainland China will be closed for the rest of the week due to the Golden Week holiday.