European Stocks Sink Into Correction on Trump’s Iran Escalation

Stocks trading data displayed at the Euronext NV stock exchange in the La Defense business district of Paris,, France, on Thursday, Oct. 9, 2025.

French President Emmanuel Macron said he'll name a new prime minister by Friday evening, having for the time being avoided the need to call a snap election that would have deepened the political chaos in France. Photographer: Nathan Laine/Bloomberg Photo by Nathan Laine /BloombergArticle content(Bloomberg) — European stocks slumped, with the Stoxx Europe 600 Index on course for a correction from its February record high, as the conflict in the Middle East escalated.Sign In or Create an AccountEmail AddressContinueor View more offersArticle contentThe Stoxx Europe 600 was down 1.9% by 9:05 a.m. in London, leaving it more than 11% below its February peak and in technical correction. Sectors retreated across the board, with real estate and mining stocks among the biggest laggards. Article contentWe apologize, but this video has failed to load.Try refreshing your browser, ortap here to see other videos from our team.Article contentArticle contentThe region’s shares fell after Iran carried out fresh strikes across the Persian Gulf hours before US President Donald Trump’s deadline to reopen the Strait of Hormuz expires. Article contentTop StoriesGet the latest headlines, breaking news and columns.There was an error, please provide a valid email address.Sign UpBy signing up you consent to receive the above newsletter from Postmedia Network Inc.Thanks for signing up!A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againInterested in more newsletters? Browse here.Article content“Trump’s ultimatum is aggravating the situation and is clearly being reflected in equity markets,” said Aneeka Gupta, director of macro-economic research at Wisdomtree. “There’s been a move from uncertainty to certainty that this looks like a more protracted conflict.”Article contentIn individual stocks, Telecom Italia SpA rose 3.8% after Poste Italiane SpA launched a €10.8 billion ($12.5 billion) public offer to delist the firm.Article contentHere’s what other investors and strategists had to say:Article contentVincent Juvyns, chief investment strategist at ING in Brussels:Article content“Markets are switching to full stagflation mode now. I hope we won’t be in 2022 again in terms of markets performance, which was an ‘annus horribilis’ for diversified portfolios. A recession obviously can’t be ruled out if the crisis continues.”Article content“We’re revisiting the stagflation playbook and looking for hedges such as renewable energy stocks and listed infrastructure. In terms of stocks, it’s important to target companies with a high level of pricing power and elastic demand. We simply can’t dismiss the warnings of the IEA about the extent of the upcoming oil and gas shock. We’re heading well under the levels we started the year on.”Article contentArticle contentPeter Tchir, head of macro strategy at Academy Securities Inc.:Article content“The costs, potential supply chain disruptions, and higher rates (when many mortgages are floating rate) seem to be a recipe for recession.”Article content“A recession was barely a gleam in the eye of any ‘doomer’ a month ago, and that risk now has to enter the conversation.”Article contentFor more on equity markets:Article contentStrategists Unfazed by War Expect Stocks to Bounce: Taking StockM&A Watch Europe: Telecom Italia, Delivery Hero, FiberCop, KKRUS Stock Futures FallArticle contentYou want more news on this market? Click here for a curated First Word channel of actionable news from Bloomberg and select sources. It can be customized to your preferences by clicking into Actions on the toolbar or hitting the HELP key for assistance. To subscribe to a daily list of European analyst rating changes, click here.Article contentTrending Garry Marr: Why it could be the right time to walk away from your real estate Personal Finance Air Canada Plane Collides With Vehicle at New York's LaGuardia Airport PMN Business TC Energy could be open to return to B.C. LNG pipeline project as global gas crunch threatens Oil & Gas Oil prices could get high enough to force a COVID-level lockdown Commodities Canadian housing bears now have nine reasons backing them up Mortgages Share this article in your social networkCommentsYou must be logged in to join the discussion or read more comments.Create an AccountSign in Join the Conversation Postmedia is committed to maintaining a lively but civil forum for discussion. Please keep comments relevant and respectful. Comments may take up to an hour to appear on the site. You will receive an email if there is a reply to your comment, an update to a thread you follow or if a user you follow comments. Visit our Community Guidelines for more information. Garry Marr: Why it could be the right time to walk away from your real estate Personal Finance Air Canada Plane Collides With Vehicle at New York's LaGuardia Airport PMN Business TC Energy could be open to return to B.C. LNG pipeline project as global gas crunch threatens Oil & Gas Oil prices could get high enough to force a COVID-level lockdown Commodities Canadian housing bears now have nine reasons backing them up Mortgages