European Stocks Dip as U.S.-Iran Tensions Flare Anew

European shares fell on Monday, June 1, 2026, as a fresh exchange of military threats between the United States and Iran rattled investor confidence. The pan-European STOXX 600 index slipped 0.5%, with Germany’s DAX and France’s CAC 40 both losing 0.6%, as traders rotated into safe-haven assets. Oil prices surged more than 3% on fears of supply disruptions in the Middle East, with Brent crude rising above $78 a barrel. The spike in energy costs weighed on airline and travel stocks, while defense contractors saw modest gains. Gold advanced 1.2% to $2,445 per ounce, reflecting elevated risk aversion. The renewed hostilities followed Tehran’s announcement of expanded uranium enrichment capabilities and Washington’s subsequent pledge to bolster military presence in the Gulf. Analysts warned that a prolonged standoff could derail fragile economic growth in the eurozone, keeping markets on edge ahead of the European Central Bank’s policy meeting next week.