European Stocks Settle Weak As Oil's Surge Fuels On Inflation, Rate Worries

(RTTNews) - European stocks closed weak on Thursday, with several markets dropping to multi-month lows, as concerns about inflation and interest rates amid rising oil prices and bond yields hurt sentiment.

Oil prices rose sharply amid rising concerns over an escalation in U.S.-Iran conflict. According to reports, the White House asked Pentagon to develop options to strike Iran before the midterm elections, but no final decision has been made. Meanwhile, oil companies operating in the Gulf of Mexico have begun curbing production and evacuating personnel from offshore facilities.

Hawkish comments from few top central bank officials and persisting concerns about France's fiscal outlook weighed significantly on investor sentiment.

Brent crude front-month futures jumped to $105.92 a barrel, before easing slightly to around $104.90, still up nearly $5.00 over previous close.

The pan European Stoxx 600 dropped 0.75%. The UK's FTSE 100 ended down 0.16%, Germany's DAX settled 1.18% down, and France's CAC 40 shed 0.51%. Switzerland's SMI finished with a loss of 1.24%.

Among other markets in Europe, Austria, Belgium, Czech Republic, Denmark, Finland, Greece, Iceland, Ireland, Poland, Russia, Spain and Sweden ended very weak.

Netherlands, Portugal and Türkiye closed higher, while Norway ended flat.

In the UK market, Standard Life dropped 3.7% after Aberdeen Group announced plans to reduce its stake in insurer Standard Life to 5.2% from the current 10.3%.

Lion Finance, WPP, GSK, IAG, Barratt Redrow, Rolls-Royce Holdings, Vodafone Group, Metlen Energy & Metals, Melrose Industries, AstraZeneca, Antofagasta, Kingfisher and Standard Chartered ended down 2%-3.7%.

HSBC Holdings, Smiths Group, Land Securities, Lloyds Banking Group, ICG, British Land Company, Natwest Group, Barclays and M&G also closed notably lower.

Tesco climbed 5.2%. The supermarket group issued slightly improved profit outlook and increased the size of its share buyback program.

Imperial Brands moved up 5.1% following the tobacco maker reaffirming its FY26 guidance and announced plans to buy back 1.5 billion pounds in shares in fiscal 2027.

Riding on higher oil prices, energy stocks BP, Shell and Ithaca Energy gained 4.1%, 3.7% and 1.8%, respectively.

AutoTrader Group, Informa, Bunzl, Pearson, British American Tobacco, LSEG, Babcock International, Sainsbury (J), IG Group Holdings, United Utilities, Severn Trent, Experian and Rentokil Initial also closed with strong gains.

In the German market, Volkswagen, Fresenius, Vonovia, Merck, Infineon, Bayer, Continental, Porsche Automobil Holding and Qiagen shed 3%-4.5%.

Siemens, Hochtief, Commerzbank, MTU Aero Engines, Heidelberg Materials, Mercedes-Benz, Fresenius Medical Care, SAP and RWE also declined sharply.

Scout24 climbed more than 3%. BASF, Rheinmetall and Zalando gained 1%-1.15%.

In the French market, Stellantis, Unibail Rodamco, STMicroelectronics, Renault, Safran, Kering, EssilorLuxottica, ArcelorMittal, Societe Generale, Legrand, LVMH, Credit Agricole, Edenred, Michelin and AXA ended down by 1.3%-3.3%.

TotalEnergies jumped nearly 3%. Schneider Electric moved up 2.5% and Carrefour climbed 1.3%. Danone and Bureau Veritas posted moderate gains.

In economic news, UK permanent job placements increased for the second straight month in September, while permanent pay growth slowed for the first time in four months, a report compiled by S&P Global showed.

There was a back-to-back increase in permanent placements in September with the rate of growth hitting the strongest in four years, the KPMG/REC Report on Jobs said.

The improvement reflects rising activity levels at employers and efforts to expand capacity amid improved business confidence. Temp billings also increased in September but the increase was the least pronounced in five months.