March 11 - European equity markets resumed their decline on Wednesday as investors weighed the economic consequences of the 12-day Middle East war and absorbed a fresh batch of corporate developments.
The broad STOXX 600 index dropped 0.7% to 601.84 points by 0819 GMT, reversing some of the prior session’s gains after the benchmark posted its best day since April 2025. Regional variance was notable - Germany’s DAX led losses, falling 1.2% on the day.
Among individual movers, defence group Rheinmetall fell nearly 5% after reporting sales growth in line with forecasts, contributing to the DAX’s relative weakness. Medical equipment maker Gerresheimer plunged 9% after announcing it would delay publication of its 2025 financial statements until June, citing investigations into certain business deals.
Geopolitical developments continued to exert pressure on markets. The United States and Israel exchanged air strikes with Iran following a round of heavy bombardments in the region on Tuesday. The conflict has obstructed key shipping lanes through the Strait of Hormuz, lifting oil prices and increasing the risk of a price shock. These developments have shaved almost 5% off the STOXX 600 from its late February record high.
Policy makers have signalled vigilance on the inflation front. ECB policymaker Joachim Nagel said the central bank will move quickly and decisively if higher fuel costs resulting from the Iran war feed through into persistently higher eurozone inflation.
On the macroeconomic front, German inflation eased slightly in February to 2.0%. Market focus is set to shift to U.S. inflation data due later in the day as well as planned remarks by European Central Bank President Christine Lagarde, Vice-President Luis de Guindos, and board member Isabel Schnabel.
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