Vadim Risef Eye Stock | Getty Images
LONDON — European stocks started the new week sharply lower as traders tracked developments in the Middle East and soaring oil prices.
pan-european Stocks 600 The stock was down about 2.1% as of 8:35 a.m. ET in London, with all sectors selling except major stock exchanges and oil and gas.
European investors are waking up to more turmoil in global markets on Monday, as oil prices rose to above $110 a barrel on Sunday for the first time since 2022, when Russia invaded Ukraine.
Yields on European government bonds also rose sharply in early trading as concerns about rising inflation were heightened by the Iran war and soaring oil prices.
In the UK, the yield is 10 years gilt The interest rate, a measure of UK government borrowing, rose 14 basis points to 4.774%. The two-year bond yield rose 32 basis points in early trading to 4.198%, while the five-year bond yield rose 20 basis points to 4.325%. In Germany, two-year bonds rose about 11 basis points, pushing short-term borrowing costs to 2.425%.
The soaring energy prices came as the Middle East’s major oil producing countries, Kuwait, Iran and the UAE, cut production in response to the closure of the Strait of Hormuz.
A bird flies near a boat in the Strait of Hormuz during the U.S.-Israel-Iran conflict, seen from Musandam, Oman, March 2, 2026.
Amr Alfiqi | Reuters
US President Donald Trump posted on Truth Social on Sunday that a rise in “short-term oil prices” is a “very small price” for defeating Iran’s nuclear threat. “Only a fool would think otherwise!” Trump added.
Amidst the huge sales, rolls royceThe London-listed aerospace and defense giant was last seen down 6.4%, dropping to the bottom of the FTSE 100, while the British multinational mining company Anglo-American It was down 6.3%.
Asian markets tumbled overnight and US stock futures plunged to open this week on concerns that rising energy prices could dramatically slow the US economy.
Iran named Mojtaba Khamenei as its new supreme leader on Sunday, the Associated Press and Reuters reported, citing Iranian state media.
There will be no major earnings or data releases from Europe on Monday.
