European Shares Seen Higher As Oil Extends Slide On Diplomacy Hopes

(RTTNews) - European stocks are seen opening higher on Monday as oil prices extended slide to their lowest levels in more than a week on hopes that diplomatic efforts could help ease tensions in West Asia.

Brent crude prices fell more than 2 percent to trade below $102 a barrel, extending losses for a fourth day ahead of this week's meeting between U.S. President Donald Trump and Gulf-state leaders on the sidelines of the United Nations General Assembly.

Ahead of the talks, Trump warned Iran that it would fail economically or face its leadership being wiped out if it didn't make a deal.

Trump indicated potential for a meeting with Iranian President Masoud Pezeshkian in New York, adding that very big things could happen soon and he is in a "deciding mode" on military action, continued economic pressure or a deal.

U.S. Central Command chief Brad Cooper announced that energy traffic through the Strait of Hormuz reached a six-month high over the past two weeks and that American forces have helped 1 billion barrels of oil leave the Arabian Gulf in the last couple of months.

The U.S. Virtual Embassy in Iran urged Americans to leave immediately, warning of flight cancellations and airspace closures.

Iran said it sent conditions to Washington through Qatar for ending the war and vowed to retaliate harshly to any fresh attacks. Iranian military officials have indicated that Washington's regional allies could be treated as parties to the conflict.

Saudi Arabia on Saturday confirmed that Yemen's Houthi rebels tried to attack its capital with a ballistic missile, the first strike targeting Riyadh since the new conflict began.

Meanwhile, as Germany faces a severe political crisis, embattled Chancellor Friedrich Merz has vowed to stay on and press ahead with potentially painful reforms to Europe's biggest economy.

Asian markets were broadly higher as investors awaited a planned meeting between Trump and Chinese President Xi Jinping this week for signs of progress in trade discussions.

Ahead of the summit, U.S. Treasury chief Scott Bessent called trade and AI talks with China very successful.

Earlier today, the People's Bank of China held its benchmark lending rates unchanged for the 16th straight month, meeting market expectations.

The dollar index held steady in Asian trade while gold traded half a percent lower at $4,354 an ounce due to expectations for additional Fed rate hikes.

U.S. stocks ended mixed on Friday as oil prices swung, a measure of industrial production unexpectedly held steady in August, and benchmark Treasury yields topped 5 percent amid uncertainty over the Federal Reserve's rate path.

The tech-heavy Nasdaq Composite rose 0.4 percent and the S&P 500 edged up 0.2 percent while the narrower Dow slipped 0.2 percent.

European stocks fell sharply on Friday at the end of a week dominated by central bank moves to restore price stability.

The pan-European STOXX 600 fell 1.1 percent. The German DAX tumbled 1.6 percent, while France's CAC 40 and the U.K.'s FTSE 100 both slumped 1.5 percent.