European stocks fell sharply on Monday, amid global geopolitical pressures after the United States and Israel launched widespread attacks on Iran over the weekend, prompting investors to sell and causing major indices, including the Stoxx 600, to decline, with most sectors falling except for energy and defense.
The pan-European STOXX 600 index fell 1.6% to 623.49 points.
The German DAX index fell by about 1.8% to 24,819.11 points, the British FTSE index declined by 8% to 10,819.89 points, and the French CAC index fell by about 1.7% to 8,428.57 points.
Norwegian oil and gas exporters Var Energy and Equinor led gains on the European Stoxx 600 index, rising by more than 9% each, amid growing concerns about global energy supplies.
European defense stocks also performed strongly at the start of trading, with Italian aerospace company Avio rising by 8.4%, British BAE Systems by 6.8%, Swedish fighter jet manufacturer Saab by nearly 7%, and Italian company Leonardo and German company Rinke each by more than 6%.
On the other hand, travel and tourism companies declined as global turmoil continued on Monday, with cruise company Carnival PLC losing 7.6%, International Consolidated Airlines shares falling 7.3%, TUI AG dropping more than 6.7%, and Lufthansa losing 6.3%.
The strikes on Iran resulted in the death of Supreme Leader Ayatollah Ali Khamenei, while the United States and Israel urged Iranian citizens to seize the opportunity to overthrow the regime.
Iran responded by launching retaliatory strikes on US bases in the Middle East region, killing three US service members.
Crude oil prices surged more than 8% on Sunday as investors worried about a major supply disruption, while U.S. stock futures fell on Monday morning, and Asian and Pacific markets also declined, with airline stocks suffering sharp losses due to Middle East airspace disruptions and airport closures.
The large-scale US and Israeli attack on Saturday came after Iran rejected US demands to limit its nuclear program, while another round of negotiations ended last Thursday without an agreement.
