Muted European Shares Amid U.S.-Iran Tensions

European stocks remained stable on Monday, influenced by rising oil prices due to the U.S.-Iran conflict. The STOXX 600 index showed little change while energy shares increased and travel stocks fell. Investors are focused on economic signals with upcoming central bank meetings and political developments in the UK.

European shares exhibited muted movement on Monday, as escalating tensions between the U.S. and Iran caused oil prices to soar, igniting inflation concerns just as the global corporate earnings season approached.

The pan-European STOXX 600 index remained largely unchanged at 641.65 at 0844 GMT. This market inertia coincided with the ninth consecutive day of U.S. strikes on Iran, increasing risks to shipping through the Strait of Hormuz following reports of immobilized tankers. Notably, Brent crude prices surged 3% to over $90 a barrel, marking their highest point in a month.

Energy stocks saw a rise of 0.9%, inversely, travel and leisure stocks fell 0.9%. Ryanair led the decline in the STOXX 600, dropping 5% after reporting a 34% decrease in first-quarter profits, impacted by heightened fuel costs and reduced fares. Meanwhile, tech stocks ticked up 0.2%, with anticipation building for upcoming earnings from major U.S. tech firms that could rejuvenate an AI-driven market rally. Despite last week's impressive quarterly reports from ASML and TSMC, investors remained unimpressed.