European stocks began trading on Monday with a decline, following sharp losses incurred last week after the escalating military confrontation between the United States and Iran prompted Tehran to close the Strait of Hormuz, alarming investors.
The pan-European STOXX 600 index fell 0.3% to 639.29 points by 0702 GMT, after posting its biggest weekly loss since late April on Friday.
The latest escalation in the conflict has renewed questions regarding the feasibility of the agreement reached between the United States and Iran last month, which aimed to resume shipping through the Strait of Hormuz and pave the way for further negotiations.
Oil prices jumped by more than 4%, boosting the index’s energy sector shares, which rose 1.6%.
Investors are also awaiting the corporate earnings season, looking for indications of whether company results can support equities, particularly in the technology sector, which faces the risk of overvaluation.
The tech sector came under pressure on Monday, dropping 1.2% as it tracked losses in Asian tech shares following the initial listing of South Korea’s SK Hynix on the Nasdaq exchange on Friday. Shares of the company, considered the world’s largest producer of AI memory chips, surged 12.8%.
Meanwhile, shares of AkzoNobel, the maker of Dulux paint, jumped 3% after Nippon Paint offered to buy the company’s decorative paints division for 7.5 billion euros ($8.55 billion).
Reuters
