Israel’s Iron Dome anti-missile system intercepts rockets, as seen from Ashkelon, Israel, October 1, 2024.
LONDON — European stocks shifted lower near midday trade on Wednesday as investors assessed the ongoing conflict in the Middle East and parsed fresh unemployment data in the euro zone.
The pan-European Stoxx 600 was down 0.1% by 11:30 a.m. London time, as the majority of sectors and major bourses slipped into negative territory. Utilities shed 1.47% and travel and leisure lost 1.29% while oil and gas stocks added 2.2% on the prospect of supply disruptions in the Middle East.
On the stock front, defense companies ticked higher on the rising conflict risks, with Saab adding 3.6% while Rheinmetall, BAE Systems and Thales and Rheinmetall all rose over 2.3%.
Shares of British sports retailer JD Sports fell 4.4%, meanwhile, even as the company reported expectation-beating revenues and profits for the first half. It comes as revenues at Nike, whose products it sells, fell short on Tuesday.
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The risk-on sentiment follows a negative start to the trading month on Wall Street, with the Nasdaq Composite shedding 1.5% and the S&P 500 losing 0.9%, after Iran launched a ballistic missile attack on Israel in retaliation for its recent killing of Hezbollah leader Hassan Nasrallah and an Iranian commander in Lebanon.
The attack came on the heels of Israel's deployment of ground forces into south Lebanon, escalating its offensive on Hezbollah, the Iran-backed militant group.
Oil prices spiked following the attack, while the CBOE Volatility Index (VIX), also known as Wall Street's fear gauge, topped 20 at its high of the day.
Money Report
U.S. futures remained lower in overnight trading, while Asia-Pacific markets were mixed.
Mainland China markets were closed Wednesday for the Golden Week holiday and will remain closed for the rest of the week. However, Hong Kong's Hang Seng index traded more than 6% higher, signaling more optimism about Beijing's stimulus policies.
Back in Europe, unemployment across the euro zone held steady on the month at a record-low 6.4% in August, Eurostat data showed Wednesday.
— CNBC's Dan Mangan contributed to this report.
