European equities opened lower on Thursday as renewed military tensions in the Gulf raised concerns over the stability of the fragile ceasefire between the United States and Iran, while also clouding prospects for a broader diplomatic agreement between the two countries.
At 07:02 GMT, the pan-European Stoxx 600 index had declined 0.4%. Germany’s DAX fell 0.5%, France’s CAC 40 slipped 0.4%, and the FTSE 100 in London dropped 0.7%.
Fresh Military Strikes Renew Investor Concerns
Investor sentiment weakened after reports that the U.S. military launched additional strikes inside Iran on Wednesday, following Iranian drone attacks targeting commercial vessels in the Strait of Hormuz.
According to the Wall Street Journal, citing officials familiar with the matter, U.S. forces destroyed a drone and targeted a drone-control facility near the southern Iranian port city of Bandar Abbas.
Iran’s Islamic Revolutionary Guard Corps later stated that it had retaliated by striking a U.S. military base and warned that any future attacks would trigger further responses.
Diplomatic Efforts Continue Without Breakthrough
Despite the latest escalation, diplomatic discussions aimed at ending the conflict continued, although negotiators failed to secure an immediate breakthrough in talks surrounding the nearly three-month-long crisis.
Elsewhere in the region, Kuwait’s military reported intercepting incoming missiles and drones, ending what had previously been a relatively calm period lasting several weeks without direct attacks.
Oil Prices Climb on Supply Concerns
Energy markets reacted to the growing instability, with Brent crude futures rising 2.6% to $96.72 per barrel.
Although oil prices remained below the symbolic $100-per-barrel level, they continue to trade significantly above levels seen before the conflict began.
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