EU stocks tread carefully ahead of US sanctions on Iran
European equities opened on a cautious footing as traders positioned themselves for upcoming US Treasury sanctions on Iran and monitored surging gold prices.
Market snapshot
European equities opened the week on a cautious footing as traders positioned themselves for the U.S. Treasury’s sanctions briefing on Iran later on Monday. Treasury Secretary Scott Bessent is slated to address the press at 1800 GMT, a session that is expected to lay out what the administration calls the toughest sanctions in history and to hint at whether China will be drawn into the package.
In Milan, the FTSE MIB edged higher, buoyed by a Barclays rating upgrade for telecom tower operator Inwit. Stellantis fell to the bottom of the index, while Prysmian and STMicroelectronics slipped after earlier gains. The banking bloc showed a split picture: Mediobanca rallied, whereas Banca Monte Paschi Siena and Banco BPM lagged as investors weighed the dual takeover bid for Piazza Meda, whose board is due to meet on 25 August 2026. Unipol posted gains and Generali remained largely unchanged.
Media additions
Across the euro‑zone, the euro‑dollar quoted at 1.167 in the early session, matching Friday’s close (Il Sole 24 Ore). A separate feed placed the pair at $1.1680, noting a slight easing as markets awaited the sanctions details (Econotimes). Technical resistance sits at 1.1744 with support at 1.1632; a breach of either level could steer the pair toward 1.1769 or 1.1552 respectively.
Energy and commodities
Oil lost momentum on the back of profit‑taking after a two‑week rally. Brent futures fell $1.49 to $92.90 a barrel by 0649 GMT, a 1.6 % decline, while U.S. West Texas Intermediate slipped $1.74 to $85.32 a barrel, down 2 % (Econotimes).
Gold surged to a three‑month high on all feeds. The Italian wire service reported spot gold above $4,600 an ounce, its highest since early May. Reuters data showed the metal at $4,641.27 per ounce as of 4:27 GMT, while another count listed it at $4,643.63 per ounce at 6:44 GMT (Econotimes, Sedaily). Analysts linked the rally to a weakening dollar and growing unease over U.S. Treasury market stress.
In Asia, silver rose 0.09 % to Rs 2,46,819 per kilogram on the Multi Commodity Exchange, driven by fresh participant positioning (Times of India). The overseas price slipped 0.19 % to $68.86 per ounce.
Asian market reactions
Asian shares dipped as the sanctions anticipation filtered through the region. Japan’s Nikkei slipped 0.74 % to 65,528.09 points, with AI‑related names such as Fujikura and Advantest under pressure ahead of Nvidia’s earnings later in the week (Il Sole 24 Ore). Samsung fell on disappointment over a planned $80 billion shareholder return, while SoftBank’s stock slipped after the bank announced a record $6.3 billion retail bond issue (Il Sole 24 Ore).
South Korea’s KOSPI dropped 3.12 % (Econotimes). In contrast, China’s A50 index edged up 1.06 % (Econotimes). The Canadian dollar weakened amid concerns of a potential trade frictions with the United States (Econotimes).
Policy backdrop
Investors are also tracking domestic U.S. Data. The personal consumption expenditure (PCE) price index for July is due on Wednesday, and the Federal Reserve’s annual Jackson Hole symposium will begin on Thursday, with Chairman Kevin Warsh scheduled to speak on Friday (Il Sole 24 Ore, Econotimes). Warsh’s remarks are expected to shape expectations for U.S. Interest rates, especially after the Treasury’s earlier announcement of a doubling in bond buybacks aimed at curbing a rise in yields (Econotimes).
Tech stocks remain under pressure ahead of Nvidia’s results, which are slated for Wednesday after the close of Wall Street (Il Sole 24 Ore). The sector’s performance is likely to influence broader market risk appetite, given the high expectations placed on the chip‑maker.
Currency and yield spreads
Beyond the euro, the British pound firmed against the dollar as markets digested the same set of cues (Econotimes). The spread between Italian BTPs and German Bunds narrowed to 81 basis points, down from 82 points at the previous close (Il Sole 24 Ore). Gas on the TTF platform stayed above €65 per megawatt‑hour (Il Sole 24 Ore).
What to watch next
Key events on the immediate horizon include Bessent’s 1800 GMT press conference, where details of the sanctions package and any potential targeting of China‑Iran trade will be disclosed. The outcome will likely feed into euro‑dollar dynamics, especially if the measures influence the perception of risk in emerging‑market currencies.
Later in the week, Warsh’s Jackson Hole speech could clarify the Fed’s stance on rate policy and the broader macro outlook, while Nvidia’s earnings report will test the resilience of the technology sector across both Europe and Asia.
Investors will also keep an eye on the board meeting for Piazza Meda on 25 August 2026, as any decision on the dual takeover bid could affect Italian banking shares. Finally, the trajectory of gold and silver will continue to mirror movements in the dollar and Treasury yields, with central‑bank buying and supply constraints cited as long‑term supports (Sedaily, Times of India).
