European stock markets displayed a mixed performance on Monday as investors assessed the impact of the latest deadlock in U.S.-Iran peace negotiations. Shortly after 8:40 AM London time, the Euro Stoxx 600 index hovered around the flat line. Major European sectors showed varied movements. Markets in London and Milan advanced, while Frankfurt and Paris closed lower. With Middle East peace talks now at an impasse, European defense stocks declined. German defense giant Rheinmetall fell 3.6%, tank parts maker Renk dropped 3.2%; Italian defense leader Leonardo plunged 4.4%, Germany's Hensoldt tumbled 3.4%, and UK aerospace major Babcock International slipped 3.5%. This reversal occurred as U.S. President Donald Trump declared Iran's counter-proposal to end the Middle East war "unacceptable." Iran's semi-official Tasnim news agency, citing informed sources, reported that negotiators had received Tehran's response to the American peace proposal, with the regime demanding a comprehensive end to hostilities on all fronts and the lifting of sanctions. However, in a post on the "Truth Social" platform Sunday night, Trump stated he did not like Iran's response, calling it "totally unacceptable!" Simultaneously, Israeli Prime Minister Benjamin Netanyahu said on Sunday that the war with Iran is "not over," and the U.S. and Israel remain committed to curbing Tehran's nuclear ambitions. Amid these latest developments, crude oil futures rose, while U.S. stock futures traded lower overnight.
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