European Stocks Slide to Three-Week Lows

European stock indexes traded mostly lower on Thursday, with the STOXX 50 falling 1% to a three-week low and the broader STOXX 600 declining 0.6%, as investors assessed the latest developments in the Iran conflict, parsed economic data and corporate earnings, and prepared for monetary policy decisions from the European Central Bank and the Bank of England. Brent crude rallied to fresh four-year highs after a report that the US military would brief President Donald Trump on potential action against Iran, stoking fears of renewed armed conflict and a prolonged blockade of Iranian ports. Among individual stocks, Stellantis dropped 7% on weak Q1 revenue, Volkswagen fell 2% on lower sales, and Credit Agricole slid 5% on missed revenue. ArcelorMittal fell 1.7% despite beating EPS estimates, while BNP Paribas lost 4% even after strong revenue. Standard Chartered gained 2.5% on record profits, Unilever held flat on strong sales, and Glencore rose 0.4% on upbeat trading earnings.

European equity markets were poised to open lower on Thursday as oil prices extended their rally following reports that the US military would brief President Donald Trump on potential action against Iran, heightening concerns that the conflict could escalate. Investors are also preparing for upcoming policy decisions from the European Central Bank and the Bank of England, both widely expected to keep interest rates unchanged, though their forward guidance will be closely scrutinized in light of the Middle East conflict’s economic impact. In addition, market participants will evaluate a fresh batch of regional data, including GDP, employment, and inflation figures. On the corporate side, earnings reports are due from BNP Paribas, Glencore, Crédit Agricole, Volkswagen, and Standard Chartered, among others. In premarket trading, Euro Stoxx 50 and Stoxx 600 futures declined 0.9% and 0.6%, respectively.

European stocks closed lower for an eighth session on Wednesday amid more concerns that higher energy prices will raise interest rates and dent earnings prospectives, while markets assessed a batch of earnings results. The Eurozone's STOXX 50 fell 0.4% to 5,814 and the STOXX 600 dropped 0.7% to 602. The US signaled it will maintain the ongoing blockade of Iranian tankers from the Strait of Hormuz in the time being, extending the impasse the prevents tankers from exporting energy and triggering another increase in energy prices. Financial companies and industrials fell further, with Munich Re, Allianz, and Siemens dropping between 3% and 2%. Deutsche Bank dropped nearly 3% after beating first quarter estimates but flagging higher credit provisions. Also, Mercedes Benz and Iberdrola closed lower after posting their results. On the other hand, Airbus and Adidas soared by 5.1% and 8.3%, respectively, on the optimistic guidances. The Fed was due to maintain rates unchanged after the bell.