09.09.202607:38:05UTC+00European Stocks Lower as Rising Oil Prices Weigh on Sentiment

European stocks retreated on Wednesday, with the STOXX 50 down 0.7% and the STOXX 600 off 0.5%, as rising oil prices continued to sour market sentiment. Brent crude climbed to $100 a barrel amid escalating tensions between the US and Iran, stoking concerns that higher energy costs will add to inflationary pressures and strengthen the case for further monetary tightening.

The ECB is widely expected to deliver a 25 bps rate hike on Thursday, with investors focused on any additional guidance regarding the future policy path.

Among individual movers, Inditex dropped more than 3% despite a stronger-than-expected start to its autumn season, as currency-adjusted sales rose 9% in August. Rheinmetall was also under pressure, losing 2.5% and giving back nearly all of its 3% gain from the previous session.

By contrast, energy stocks advanced on the back of higher crude prices. TotalEnergies rose 1%, Shell climbed 1%, BP added 1.7%, Galp gained 1.6%, and Repsol advanced 2.1%.