European Shares Poised For Big Losses Amid Geopolitical Tensions

(RTTNews) - European stocks are seen opening deep in the red on Monday as the U.S.-Iran confrontation deepened and began to reverberate across the broader Middle East.

U.S. President Donald Trump signaled the U.S.-Israeli military assault on Iranian targets may last about four weeks, framing the conflict a complex operation against a large and resilient adversary.

At the same time, he signaled that diplomatic channels with Tehran remain open. Iran intensified its retaliatory strikes against American allies in the Persian Gulf and Israel on Sunday, triggering threats of regional retaliation.

Israel launched new air strikes targeting Tehran and expanded its military campaign to include attacks on Iran-backed Hezbollah militants in Lebanon, suggesting the conflict may spread across the Middle East.

Elsewhere, tensions between Afghanistan and Pakistan have sharply escalated after Afghan Air Force attacked key Pakistani military installations, including the Nur Khan Airbase in Rawalpindi in response to the recent aerial incursions by the Pakistani military.

In economic news, the U.S. Labor Department's monthly jobs report along with other reports on retail sales, manufacturing and service sector activity will be in the spotlight this week amid considerable uncertainties over U.S. tariffs and Fed policy. In Europe, regional manufacturing and services PMI figures, final fourth-quarter GDP and employment data from the euro zone, and the spring statement by the U.K.'s treasury chief may garner attention as the week progresses.

Asian markets were mostly lower, with Chinese stocks bucking the weak trend as national lawmakers and political advisors gather for a key strategic session.

The dollar index rose on risk aversion as Brent crude futures briefly crossed $80 per barrel on worries that the U.S. and Israel's attack on Iran could escalate across the region and hit oil supply.

With the Strait of Hormuz, a critical oil chokepoint, facing potential disruptions, eight OPEC+ nations have announced that they will increase crude oil output by 206,000 barrels daily in April.

Gold prices traded up more than 1 percent above $5,350 an ounce.

U.S. stocks fell notably on Friday and notched their largest monthly percentage declines in a year on the back of escalating U.S.-Iran tensions, revived tariff uncertainties and renewed concerns over costs, disruption and layoffs related to artificial intelligence.

Prices paid to U.S. producers rose in January by more than forecast, pointing to lingering inflationary pressures and denting hopes for Federal Reserve rate cuts in the near term.

There were also concerns about possible losses from the collapse of U.K. residential mortgage bridging lender Market Financial Solutions.

The Dow lost 1.1 percent, the tech-heavy Nasdaq Composite shed 0.9 percent and the S&P 500 slid 0.4 percent.

European stocks ended mixed for a second straight session on Friday, with AI-related and geopolitical news in focus.

The pan European Stoxx 600 edged up by 0.1 percent. The German DAX finished marginally lower and France's CAC 40 dropped half a percent while the U.K.'s FTSE 100 added 0.6 percent.