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Europe stocks set to fall as US-Iran tensions fuel oil rebound

By Reuters News

Nov 3 (Reuters) - Europe's benchmark equities index was set to fall at the open on Tuesday after reports that the United States carried out strikes on Iran sent crude prices higher, dampening hopes for an imminent end to the months-long conflict.

Futures tracking the pan-European STOXX 600 index slipped over 1%, with contracts tracking Germany's DAX and Spain's IBEX down about 1% by 0712 GMT.

The US carried out strikes on Iran's Qeshm Island in the Strait of Hormuz, a US official said, a day after Iran signalled openness to peace talks and President Donald Trump also indicated that he might be open to hold off on any strikes on Tehran after the midterm elections.

Brent crude prices gained 1.6% to over $100-a-barrel, bouncing back from a 7% fall in the previous session.

Airlines, which have borne the brunt of the volatility in energy costs, will be in focus, with German airline group Lufthansa LHAG.DE announcing that it was trimming its profit outlook.

AI stocks such as Aixtron AIXGn.DE, ASML ASML.AS and Schneider Electric SCHN.PA could also come under pressure following a selloff in Asian equities earlier in the day. Investors are reassessing the AI trade that has lifted global markets over the past few years, following disappointing results from major US hyperscalers in the previous week.

Tech giant Apple's AAPL.O dour gross margin forecast for the crucial holiday quarter as a result of rising memory-chip costs is also weighing on risk appetite.

Bucking the trend, German pharmaceuticals and agriculture group Bayer BAYGn.DE is likely to be among top gainers after raising its 2026 profit outlook.

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