LONDON, March 13, 2026, 10:36 GMT
European shares fell on Friday and looked set for a second weekly loss, as oil stayed above $100 a barrel and the conflict involving Iran kept markets on edge. The STOXX 600 was down 0.5% at 596 by 0924 GMT, banks led losses with a 1.9% drop, and energy stocks bucked the move, up 0.5% with BP and Shell each gaining more than 1.5%. Traders have also swung from betting on ECB rate cuts to pricing one quarter-point hike by year-end and nearly a 75% chance of a second move.
It lands on a weak economic base. Euro zone industrial output fell an unexpected 1.5% in January, official data showed, and the bloc imports much of its energy, leaving manufacturers especially exposed to oil and gas shocks.
Britain’s numbers were no sturdier. GDP was flat in January and up only 0.2% in the three months to January, while Fergus Jimenez-England of NIESR called it a “worrying start to the quarter” if high energy costs stick. Reuters
Pre-open coverage pointed to a weaker session as oil stayed above $100, and Barron’s said the FTSE 100, DAX, CAC 40, IBEX 35 and FTSE MIB all opened lower.
Bloomberg reported mining shares led losses and that private-credit worries were also weighing on banks.
Thursday had already set the tone. The STOXX 600 closed 0.6% lower, its seventh decline in nine sessions, leaving the index about 5.6% below where it stood before the conflict began; Marija Veitmane, head of equity research at State Street, called Europe “a very energy-hungry economy.” Reuters
Crude has given markets little room to breathe. Brent settled at $100.46 a barrel on Thursday after touching $101.60, while U.S. crude ended at $95.70, both the highest since August 2022. This week the IEA said its 32 member countries would release 400 million barrels from emergency reserves, the biggest coordinated stock release on record.
The repricing has spread well beyond Europe. The dollar has climbed 2% since the war began, traders now see only 0.2 percentage points of Federal Reserve easing this year, and next week’s meetings at the Fed, ECB, Bank of England and Bank of Japan are hanging over markets. Vasu Menon of OCBC said investors should brace for “continued volatility” and possibly more downside near term. Reuters
But the selloff is not just about crude. Investors are also tracking strain in private credit, the market for loans made outside traditional banks, after some managers halted redemptions and banks tightened lending to the sector. John Plassard of Cite Gestion warned that what moves through the Strait of Hormuz “does not stop at oil” because supply chains run through the corridor too. Reuters
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