Today’s landscape is getting darker for European stocks. Regional benchmarks drifted lower alongside U.S. futures, following another negative session in Asia. The risk-off mood has been built by investors who want to stay cautious ahead of the next FED meeting, reducing portfolios exposure and taking some profit. Furthermore, this sentiment has been boosted overnight by rising geopolitical tensions after the U.S. were said to be sending more troops to the Middle East due to the Iranian threat, according to officials.
Photo by Zbynek Burival.
Investors fear that another military conflict with Iran could have a strong impact on oil prices and, mechanically, on the stock market. In addition, an escalation of the dispute could also involve more nations, like Russia, which could put European oil supply at risk. The Stoxx-50 index fell today even though the bulls are currently defending the 3,365.0pts price level. Volatility is likely to be on the rise as investors will be paying attention to significant economic data expected from both EU and the U.S.