European stocks under pressure as Israel and Hamas clash

European stocks came under pressure on Monday as clashes between Hamas and Israeli forces sparked a rush to safe-haven assets such as bonds and gold, while boosting oil prices more than 3 per cent.

Global investors turned risk-averse as clashes between Israel and the Palestinian Islamist group Hamas deepened political uncertainty across the region and raised oil supply concerns.

Israel said its troops backed by helicopters had killed a number of armed infiltrators entering the country from Lebanon, raising fears fighting could spread two days after Hamas gunmen burst in from Gaza on a deadly rampage.

Dublin

The Irish index of shares fell 1.5 per cent, dragged lower by declines in travel and building stocks.

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Airline Ryanair saw its stock price fall almost 3.7 per cent, tracking its European peers amid fears that rising crude oil prices would hike fuel costs.

Flutter Entertainment declined 2.7 per cent, and travel software firm Datalex was 1.7 per cent off by the closing bell.

Shares in insulation specialist Kingspan were also lower, falling 2.12 per cent. Smurfit Kappa also ended the day lower at €31.11, down 1.1 per cent.

London

The benchmark FTSE 100 index was flat, while the midcap FTSE 250 index fell 0.9 per cent.

Travel and leisure stocks fell 3.0 per cent as several international carriers suspended flight services to Israel. British Airways owner IAG, EasyJet and Wizz Air declined between 5.9 per cent and 6.2 per cent.

In corporate news Metro Bank announced a £325 million capital raise and a £600 million debt refinancing on Sunday, giving majority shareholder control to its biggest investor, Colombian billionaire Jaime Gilinski. Shares of the mid-sized lender jumped 10.9 per cent.

Croda International (CRDA. L) slid 7.3 per cent after the speciality chemicals group cut its annual profit forecast due to destocking and weak demand. The broader chemicals sector eased 4.4 per cent, leading losses.

Europe

The pan-European STOXX 600 index edged 0.3 per cent lower, led by retailer and travel and leisure stocks.

Airline stocks, including Air France KLM and Lufthansa, fell between 4 per cent and 8 per cent as several international carriers, concerned about higher fuel costs, suspended flight services with Tel Aviv.

Shares of defence companies such as Sweden’s Saab, Italy’s Leonardo and Germany’s Rheinmetall surged between 4 per cent and 9 per cent on the prospect of a prolonged military conflict in the region.

Energean tumbled 17.6 per cent, making the UK and Israel-listed oil producer the top loser on the STOXX 600.

Among other stocks Siemens Energy added 1.1 per cent after Reuters reported the company is considering shutting down Siemens Gamesa factories and sales offices as part of a review aimed at reducing wind turbine business losses.

Vitesco shares rose 21 per cent to a record high on news that family-controlled Schaeffler will launch a tender offer valuing the German powertrain supplier at €3.64 billion.

New York

Wall Street’s main indexes fell on Monday as a deepening conflict between Israel and Hamas roiled global markets and pushed investors toward safe-haven assets, while crude prices jumped around 4 per cent. By mid-morning the Dow Jones Industrial Average was down 13.18 points, or 0.04 per cent, at 33,394.40, the S&P 500 was down 6.67 points, or 0.15 per cent, at 4,301.83, and the Nasdaq Composite was down 75.77 points, or 0.56 per cent, at 13,355.57.

Major technology stocks Apple, Microsoft, Nvidia and Amazon.com fell between 0.2 per cent and 2.7 per cent.

Traditional safe-haven assets including gold and the US dollar gained, while crude prices increased.

United Airlines, Delta Air Lines and American Airlines suspended direct flights to Tel Aviv. The airlines’ shares were down around 5 per cent each, dragging the S&P 500 Passenger Airlines index down 4.5 per cent to its lowest in a year.

Defence companies Northrop Grumman, RTX, General Dynamics, L3harris and Lockheed Martin rose between 4.3 per cent and 8.7 per cent. The broader S&P 500 Aerospace & Defense index jumped 4.9 per cent.

Tesla fell 2.5 per cent as data showed the company’s China-made EV sales volume for September decreased. – Additional reporting: Reuters

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